Choosing the right franchise opportunity can be tricky.
You must decide on a sector, find a franchise team you think you can build a rapport with, as well as a brand you think has staying power and a support package that warrants the financial outlay.
Be proactive when you’re researching franchise opportunities. Speak to established franchisees, ask them about the level of support they receive, the hours they put in, their income (if they don’t mind) and whether the franchise has lived up to their expectations.
Find out as much information about the franchise as possible before you hand over any money. The internet has made things much easier in this regard.
The British Franchise Association can help you choose a suitable franchise. All of its members have been vetted according to a strict code of practice, so you should check whether any franchise under consideration has been accredited to the body.
Search the web for any press coverage, positive or negative, about a franchise that interests you. Perhaps the company recently reported record profits, or maybe it’s on the brink of being taken over. Whatever the brand’s fortunes, it’s important to know what you’re buying into.
Buying a franchise opportunity can often cost more, at least initially, than starting your own business because you’re paying for an established reputation and customer base. You should also expect the franchisor to provide the materials and equipment needed to start running the enterprise on day one.
If you’re a premises-based franchise then ask the franchisor about how they find you premises. This is particularly significant if it’s a sector where passing trade is important – a convenience store for example – so high footfall locations are a major boon.
If you’re enquiring about a sector involving a lot of travelling around, for example a delivery franchise or where you frequently visit customers or suppliers, the franchisor will doubtless provide a van or other vehicle as part of the franchise fee.
If any of the aforementioned items aren’t included in the franchise package it can become expensive, so be sure to check carefully precisely what comes as part of the deal and clarify any ambiguities with the franchisor. A franchise might appear to be cheap, but it’s a false economy if the running of your business involves the expensive procurement of materials and equipment not included in the package.
Prior to the launch of the business the franchisor will always provide training, lasting anything from a few days to several weeks, to new franchisees.
A good franchisor should also offer ongoing support beyond launch, ideally a single contact, an account manager who you can phone directly when you have any problems or queries. It’s important to have support promptly whenever you need it.
So what will be your contact’s availability? If you need to work evenings but your mentor turns his or her phone off at 5.30pm then you could end up very frustrated.
How many other franchisees will this contact split his or her time between? If there’s one person providing support to a 50-strong network, then alarm bells should ring.
And will that person be a jack of all trades? It reflects well on a franchisor if they promise specialist support in a range of areas – ie, website help from web designers and coders, accounting support from an accountant, and so on.
A fundamental pillar of the franchise model is that owning your own business shouldn’t mean you feel like you’re on your own. If you get the impression that you’ll be expected to run things without asking for help once launched, then reconsider your options.
It is common for franchises to hold quarterly regional meetings. Find out whether franchisees are invited and encouraged to express concerns, ask questions or generate ideas to regional franchisors and managers. Ask a franchisor about their policies on encouraging feedback from franchisees.
You want to be in a franchise network where you feel valued and encouraged. Open lines of communication between franchisor and franchisees are fundamental.
Every business has a marketing strategy of course, and anything done to promote the brand you’ve paid to operate under will ultimately help boost custom in your business. However, the reach and impact of a campaign run by a fast-food giant like Subway will be of a different order to a recently franchised, largely unknown brand with just a handful of franchises centred on a particular region.
The level of marketing, promotional assistance and PR a franchise provides can vary considerably. While all franchisors will conduct national campaigns, some will conduct a full PR and marketing campaign focused on your territory to support the launch of your franchise.
Some franchisors will give you a database of contacts and leads in your area so you can acquire customers from day one. You may be given your own page on the national website, or even your own website whose content you can customise.
Whatever the level of support and success of a given franchise opportunity, you must have a keen interest, even a passion, for the sector it operates in and the service or product it provides. Buying a franchise doesn’t guarantee success, but if you enjoy what you’re doing you’re more likely to work hard and maintain determination even in adversity – so ultimately, the enjoyment dimension is the most important factor of all.
Find out about Assessing Franchise Opportunities at Exhibitions.