Franchising

The world of franchising is a wonderful opportunity but franchisees should prepare themselves before they buy a franchise. Helpful guides and e-books written by industry leaders can help entrepreneurs to understand the franchising system. Potential franchisees should do thorough research and learn everything they can about franchising.

A Guide to Franchising

Perfect Fit

A franchisee must be the perfect fit for a franchise. The franchisee must have the proper skill sets to succeed in that business. After due diligence, franchisees must decide if a specific franchise is right for them.

Franchise vs. Start-up Business

Statistics show that more franchises succeed than start-up businesses. That encouraging fact, however, should not make an individual choose a franchise without putting considerable thought into the decision. Franchising is filled with systems, processes, and methodologies, and franchisees must be able to follow them.

Big Brands vs. Small Brands

Many entrepreneurs are inclined to set their sights on 'big' brands. Yet big brands are not always the best choice. Actually, many people do not understand the real difference between big and small brands. Of course, big brands are the businesses with the huge physical presence. Yet there are also 'big' brands that most people would not view in that light. Franchisees must educate themselves about every aspect of franchising.

Professional Advice

At some point, every franchisee will need professional advice such as a lawyer and an accountant. Yet franchisees do not need to hire these experts in the initial exploration stage. Franchisees will need them later to check out the details of the deal before any final decisions.

Risk

Franchisees must understand that most franchises meet with success but there is always an element of risk in business. Franchisees can, however, minimize the risk by making an informed decision.

Financing

Obviously, buying a franchise requires financing. Entrepreneurs can obtain that financing from different sources - angel investors (family and friends), commercial lenders, specialty lending institutions, and SBA Loans (US) and SBL Loans (CAN), as well as franchisors.

Entrepreneur

Franchisees must understand which category they fall into as an entrepreneur. There are three types of entrepreneur - the 'people' person, introverted types who prefer processes to customer service, and the team manager.

Franchise Show

Before buying a franchise, individuals should attend a franchise show. People must participate in the show rather than just observe the action. They must ask intelligent questions and learn as much as possible about different franchises. A franchise show is one of the steps in the process of due diligence. As well, every franchisee should have a franchise mentor to explain the basics of franchising.

Passion

Above all, a franchisee must have passion for their business. Actually, the franchisee wants to be certain that the CEO of the franchise has passion for the company. Vision, heart, and passion start at the top and trickle down through the franchise. If the owner does not enjoy the business, the customer will pick up on these negative vibes and go elsewhere. Passion is one of the main keys to success in franchising.