Thanks to Tyler Nix for sharing their work on Unsplash.
A franchise business can be an excellent opportunity to run with expert support. Whether you’re already an entrepreneur or looking for a career change, a franchise can be the right choice. If you have always thought about being part of a franchise but weren't sure how to go about it, luckily, much more information is available now for those who are raring to get on that franchise ladder. With pages showing how to begin one yourself to websites promoting franchises under 100k, there is so much for people to now choose from. But how do you know if you have found the right franchise? A good opportunity will have these signs.
Industry growth is a key factor. Please look at the potential for growth in the industry that has piqued your interest. While some franchisors may offer market research on their industry, it's crucial to conduct your own due diligence. This enables you to grasp the growth potential in your local area, a significant aspect of your decision-making process. For example, while frozen yogurt might be a popular trend in franchising, if your neighborhood already has a saturation of frozen yogurt shops, this might not be your most favorable opportunity.
Unit growth. Look for an ongoing increase in franchise units, which shows that a franchise is thriving. One significant benefit of buying a franchise over starting a business from scratch is having the franchisor’s name and brand recognition to help you. The more open units, the more brand awareness consumers will already have. To learn more about which franchise opportunity to pursue, you can check out this guide on the best cleaning franchises, or other resources addressing your franchise or industry of choice, in order to expand your knowledge before taking the final plunge.
The strength of franchisor support is crucial. What kind of training and assistance can you anticipate to receive to help you establish and maintain your franchise? Does the franchisor employ any franchise management software? Even a small franchise system can be a profitable opportunity if the support level is robust. This provides you with the confidence that you're not alone in your business journey.
The quality of management is a key consideration. Learn about the individuals behind the company and their experience in franchising. Running a successful coffee shop is one thing, but growing a coffee franchise is another. How long has the company been franchising? Make an effort to meet with the management team and the franchisee support staff to gain insight into what it might be like to work with them on a daily basis.
Marketing and advertising support. What kind of marketing and advertising programs does the franchisor have in place? Are they taking advantage of new trends that others in the industry use, like online marketing or social media? You will probably have to pay a monthly royalty, so make sure you’re getting your money’s worth for what you pay.
Satisfied franchisees. Meet and talk with current and former franchisees for honest feedback on the franchise system. If all the franchisees are unhappy, or even worse, they are suing the company, this is a very bad sign. But if you find that the franchisees you talk with love what they’re doing, this is a bonus.
Adequate earnings. Can you realistically make a living from the franchise? You'll need to estimate your potential earnings so you can do so. Some franchisors will provide information on average earnings, which can be helpful. You'll need to work out an estimate for others by talking to other franchisees, which isn't so terrible if you don't mind reaching out to strangers.