To many prospective small business owners, starting a franchise may be the easiest path to success.
But there are many twists and turns to navigate before you decide to start a franchise.
Franchising has always been based on uniformity and not necessarily freedom. As a franchisee, you don’t really hold the reins. The adage ‘be your own boss’ may not apply to every aspect of the business.
But no matter what, you still get to run your own business. That’s the major upside.
These five tips will help you recognize what you’re jumping into and how to plan out your journey. It all starts with doing your homework – lots and lots of homework.
1. Do The Research
Putting in your due diligence is paramount. Get legal advice from a lawyer familiar with franchise law. Read every document you can get from the franchisor. Speak with local and experienced franchisees.
Try to attend franchise expos and conventions to obtain as much information as possible.
If you don’t put in the research, you won’t know what you’re getting into. Knowing your skill-set, understanding franchisor expectations, and setting your own expectations is what usually leads to a successful venture.
2. Have A Business Plan
Having a road map in place with a clear marketing and sales plan is vital. Most of the time, a lawyer or accountant will help potential franchise buyers write a business plan.
However, an accountant may not know much about sales or marketing. Speaking with the franchisor and other franchisees will help you map out your own plan for success.
3. Follow the Franchise’s Plan
Franchisors have a system to follow for a reason and it’s best to stick to it. This isn’t your plan, it’s theirs.
Most franchise agreements give franchisors the power to change required procedures or the product line. So, basically, franchisors hold all the cards and there may be contractual language limiting franchisees’ rights to file grievances. It’s important to read every word in the franchise agreement before you sign it.
Being innovative is possible within a franchise but it’s best to understand limitations imposed by the franchisor and work with them to ensure success.
4. Don’t Be Complacent
Being a successful franchisee takes time and hard work. Although you are basically the franchisor’s full-time employee, a specific revenue and income isn’t guaranteed.
Franchisees shouldn’t become complacent with early success and expect that business will always be good. Losing the hunger to grow will hurt any small business.
5. Imagine Failing
Failure is a powerful motivator. Try imagining what it’s like to fail, even if you’re an established franchise.
Don’t believe you can’t be touched or won’t fail. It’s important to have an optimistic attitude, but don’t gamble by not considering all possible outcomes.