Making the decision to become a franchisee certainly isn’t a simple one. There is an array of considerations, one of the most important which is choosing a company.
If you’re considering buying a franchise, there are six things you can do to guide the decision-making process and prepare yourself.
Begin broadly. When you’re in the initial planning phases, cast a wide net. Look at industry trends and generalized market information to guide you in the right direction. You can use resources like the Entrepreneur Franchise 500, published yearly, to determine how categories of franchises are doing, rather than specific companies. When looking at broad categories, think not only about present performance but also future potential and opportunities for growth.
- Choose a company or brand in which you’re personally interested. Owning a franchise is challenging, to say the least. It helps to look for brands that represent an actual interest for you, in addition to financial interest. To be successful it’s important you’re engaged in your business Don’t make a selection based simply on how lucrative the company is, or what seems like a trendy venture.
- Speak with other franchisees. Whatever company you’re considering, don’t make a decision until you’ve spoken to at least five other franchisees. This is imperative because it helps you look beyond the hype and marketing materials and get a real feel for what it’s like to be part of this particular organization. You may consider speaking with more than five franchisees, but that number should be a minimum. Along with this comes the recommendation of spending time within the business, if at all possible. Take the time to shadow other franchisees and see how their business operates on a day-to-day basis.
- Seek expedited training options. Many franchise organizations offer opportunities for new franchisees to participate in training programs that will allow them to accelerate the process of getting their business up-and-running. For example, McDonald’s is a global company that has a comprehensive training program allowing crew members to begin the process of working toward becoming an owner-operator.
- Look for a great training program. Speaking of training—it’s crucial when selecting a franchise. Signs of a good franchise training program include in-depth pre-opening training, mentorship and on-site training. Robust franchise training programs also include ongoing support and development. Look into how far a franchise will go in providing these opportunities. How focused are they on training? What type of resources do they dedicate specifically to the training of new franchisees? What about development? Is it long-term? If these questions aren’t answered, consider a different business opportunity. It’s a good idea also to look for a franchise that offers modernized training. Owning a franchise is complex and always evolving, so training needs to keep up. Consider options with online training, or even training available on a mobile device or tablet, rather than simply being information provided via manual. Another interesting aspect of McDonald’s franchise training is that you’re required to work, free of charge, in every position in the restaurant. This type of hands-on cross-training is a great way for franchise owners to not only become leaders but to understand the complexities and inner workings of every aspect of the business.
- Consider the risk. When you’re thinking about buying into a franchise, smaller businesses may be more affordable, but you may not have the safeguards and resources you’re going to enjoy with larger and more established franchises. Weigh the costs against the risks and benefits.
Have you become a franchise owner? If so, let us know the process you went through when making a decision.