Historically, we’ve seen an increase in individuals exploring franchise and business opportunities from Labor Day through the first week in December. With kids back to school and summer coming to end, we have found it’s a time of year when many start looking at the past year over their shoulders and begin to really focus on their options. We have found that business ownership is always at or near the top of the list.
Typical questions they ask of themselves pertain to resolutions they had set at the beginning of the year, their earnings for the current year against their expectations, and their level of satisfaction in their current job. The ultimate question about starting yet another year in a job as opposed to fulfilling a dream of business ownership is also on their minds.
Considering what has been experienced over the past two and a half years, we’re seeing even more individuals asking about business ownership beyond the typical financial questions. Current conversations are also focusing on freedom and being able to control one’s own destiny. Some are also focusing on business ownership as an income diversification and investment strategy.
So, with all this in mind, I believe it’s a perfect time to revisit some of my previous articles about exploring entrepreneurship, franchising and business ownership. I will share these articles (in no particular order) over the next few weeks.
I believe these articles along with new ones I’ll also be sharing, will provide great value in understanding ALL options available. My goal is to help answer questions while providing the information necessary so interested parties can make informed decisions, and the right decisions for them.
5 Tips for Finding the Perfect Franchise
With the Great Resignation still in full swing, a lot of people are choosing to take control of their personal and professional future by exploring entrepreneurship.
Of those who realize their entrepreneurial potential many choose owning a franchise as the vehicle to take them from employment to entrepreneurship due to the already proven business model and built-in, ongoing support system, among other benefits.
If becoming a franchisee seems like the right path for you, follow the tips below to find the perfect opportunity.
1. Keep an open mind, then focus. No one wakes up and says, “I want to be in the septic tank industry,” but I know someone making a lot of money and meeting his lifestyle goals doing just that. The bottom line is: Don’t rule out a business without learning or seeing what the day-to-day will look like.
It’s important to find a franchise that allows you to reach your desired income, lifestyle, wealth and equity goals. For instance, think about a mom returning to the work force who knows she wants to interact with children on a daily basis. There are hundreds of options that allow her to do just that. Now, she needs to decide if she would like to be hands on as a teacher or if she would rather manage a facility that tutors children in math. Deciding between the two is easy if she considers which day-to-day position she would prefer and how that will impact her other goals.
2. Be proactive with your research. After you’ve determined what role you want in a franchise, it’s important to start scouting different options. Physically visit many different franchise locations to see if there is a void in the marketplace and start thinking strategically about how you could fill it.
Next, browse the web to see what is available in other areas and determine whether or not it will be a fit in your community. For example, if your neighborhood has many well-run restaurants but none dedicated to ethnic food, it may be time to look for Mexican franchise restaurants within your budget.
3. Make sure the franchisor has experience. Before signing on to a franchise, it is essential to ask the franchisor about the executive team and its past industry experience. A potential franchisee should look for a company that has a corporate store — or better yet several — that have seen success that can be replicated. If this isn’t the case, find out if the company leaders have had significant experience at another franchise and are now applying that knowledge to this concept.
4. Reach out to other franchisees. When asking other franchisees about their experience, it’s important to take the good with the bad and to examine a large sample size before making a statement about the franchise in general. I call this the “dilution factor.” If one franchisee says they can’t turn a profit at their store, make sure it isn’t because they refuse to clean the bathrooms and their customer service is lacking. By talking to a wide array of people you can get the best feel for the franchise as a whole.
5. Read the franchise disclosure document carefully. The first thing to look at is how much a franchise would cost to purchase. If the money is there, then check out “item 19,” which lays out the financial performance representation. Make sure you have a financial advisor who can look at that item with you and see the type of profit a franchisee can make on average.
Finally, take a look at the post-termination clause in the agreement. I am a big believer in exit strategies, because sometimes you may later find a franchise is not the right fit and sometimes things just happen. In any case, it’s important to protect yourself should there be a situation where you want to disembark from the franchise.
If you’re considering business ownership for yourself and your family, and want to learn how the choice of a franchise, startup or acquisition can “jump-start” the process and your earning potential, please review the information at one of our new resource sites at https://ownabizness.com/.
Have a great day. Make it happen. Make it count!