Any career transition in life requires proper due diligence. You wouldn’t take a job without knowing who the boss was, what the job expectations were and whether or not the position was stable. Franchise ownership necessitates just as much research and assessment – and then some.
When you buy a franchise, you’re making a commitment of time and money – two commodities that you aren’t apt to take lightly. While it’s important to value the product or service you’re selling, you also need to like the franchise partnership as a whole and be comfortable with the prospect of being your own boss.
Before you invest in a franchise, ask these three important questions to think more critically about whether you’re choosing the right one.
How many of the company’s franchises fail?
We all want to know the numbers surrounding success: how much you’ll make, how long it’ll take to turn a profit, etc. But, potential franchise owners seldom ask how many franchises fail – and more important, why they failed.
Was location a factor? Were the product prices too high? Was the corporate partner not supportive enough? You may even want to track down owners of franchises that have not been successful. While it does require extra research, you’re going to find out, in greater detail, why their location failed and whether or not the franchise model was to blame.
Choosing the right franchise to invest in is not a quick or easy task, and you need to be aware of the risks you’re taking. So, be sure to make this a high-priority question in your search for the best opportunity.
Is the corporate partner supportive?
When prospective buyers are researching franchise ownership investments, they often make the mistake of focusing their questions only on themselves. In choosing a franchise, you’re also choosing a corporate partner – and you want one that fits your personality and lifestyle.
Ask your potential corporate partner what levels of support they offer to owners. And ask other franchise owners if they feel that their corporate partner has really followed through with those promises.
It’s important to know whom you’re getting into business with before you take the leap. The more supportive a corporate partner is, the greater your likelihood of succeeding. Look for a franchise that offers support in the following areas:
- Location selection
- Training materials
- Sales guidance
- Marketing efforts
- Financial processes
- Daily operations
What feedback do current owners have on the investment?
The only people who are truly able to give you an accurate picture of franchise ownership with the corporate partner you’re considering are those who have already invested. It’s essential to talk to these people.
Your potential corporate partner may push you in the direction of their top franchise owners, but do your own research. Meet with other owners in your area to discuss the benefits of investment.
The best way to gauge their feelings about their franchise experience is by asking if they would do it all over again. Would they still invest? Was it worth it? They are best equipped to tell you if the work-life balance they were seeking became a reality or if the business brought in enough profit to ensure financial stability. Ultimately, the people who know the ins and outs of buying a franchise are those who have already experienced it. Talk to them about whether they felt it was a wise investment.
There’s more to learn about franchise ownership and getting the corporate support you need to succeed. Click below to watch our free webinar on franchise ownership support for success.