Buying a franchise is an exciting step towards becoming your own boss. There are many benefits to becoming a franchisee but you should also be wary of the things you should be avoiding during this time.
One of the many benefits of becoming a franchisee is being safe in the knowledge that the business is proven and profitable. The franchisor will have already tried and tested all aspects of the business to find out what works for the brand and what makes a profit.
As a franchisee, you will be using that knowledge to generate your own success through the brand. But keep in mind that this does not mean the business will run on its own. You will still need to put in the effort and hard work that it takes to make a business successful.
Speaking of hard work and successful businesses, although you will have the support of your franchisor behind you, this does not guarantee a successful business for you. You will likely receive assistance from your franchisor in terms of marketing, business growth and business development, but this doesn’t mean your franchise will be an instant success. You will need to put in the miles to ensure your own business success too.
Buying into a franchise is a huge personal and financial investment. You want to make sure that when you do decide to exit the business that you come out with more than you have spent. However it is not uncommon to underestimate the costs involved in the franchise.
Keep in mind the costs for legal and accounting fees, marketing costs, insurance, and working capital. Make sure you speak to your franchisor in detail about the costs involved in the franchise so you can prepare yourself accordingly for what may come.
The due diligence part of the process cannot be undervalued. You want to ensure that the decision you make is the right one for you, your family, and your future. Speak to experts in franchising who can give you honest answers to what you are investing in. This includes franchisors, existing franchisees, friends, family, lawyers and even experts from the British Franchise Association.
Taking your time may come as a benefit to you and as much as you may be ready to get on with investing, it will be costly to make a mistake and end up with a bad business decision.