Franchise Advice
Motivated
Franchisors mainly seek franchisees who are looking to run their businesses in a hands-on fashion with a desire for business success. This desire cannot be matched by a salaried manager and this is why franchised operations will tend to off er greater quality of service and place more emphasis on customer satisfaction and local market knowledge. Franchisors look for prospective franchisees who have a genuine enthusiasm for the industry or sector in which they are investing. Enthusiasm, determination, resilience and common sense are usually prized more highly than industry experience in franchising – the training should help overcome any discrepancy in this area.
Team player
When buying a franchise, you are investing in a proven and fi ne-tuned business blueprint. It is important that you are willing to work within the confi nes of the franchisor’s successful systems and procedures. This is because the franchisor has already gone through the trial and error of development, learned how to avoid mistakes, and fi ne-tuned and developed the business package on behalf of the franchisee. Franchising also standardises product
off erings across a network. Deviating from the plan can cause rifts and discrepancies between branches. A franchisee that is likely to be uncomfortable with the authority of the franchisor may not be suited to becoming a franchisee in the fi rst place. If you are the type of potential entrepreneur that wants total control of your company’s image and direction, you may be better off considering other avenues of business ownership.
Dedicated
The decision to become self-employed involves a great deal of soul-searching. What prompts it can just as often be
the desire to escape employment as the drive to build a successful organisation. Don’t think for one moment, however, that franchising is a way to cut down your working hours. With the future of your business in your hands, you won’t be able to switch off at 5.00pm; you may fi nd yourself working six days a week until well past the initial stages. Franchisors realise this but, while many will off er plenty of support to help you get your business off the ground, they can’t do it for you.
Financially aware Franchises are often very aff ordable, with some superb opportunities available for an initial investment of less than £15,000. Additional funding is readily available from the banks, where there is a great deal of recognition for the reduced risk inherent in franchising. Like you, banks are well aware of the high survival rate of franchises compared with that of small businesses. Most banks have set up specialist franchise departments and have developed relationships with franchise brands to assist their franchisees with funding and managing cashfl ow needs. The income derived from owning your own business will prove much more irregular than that which is earned through employment. There is no pension or sick pay – except that which you set up for yourself – and much of what the business does earn may be required for reinvestment as you grow your operation. Can you deal with this insecurity and are you able to support yourself until the business fi nds its feet? The franchisor will help you develop your business plan, but it will take determination on your part to see it through.
A people person As your business grows, you will need to take on and lead staff . Franchisors will deal with management skills during the initial franchisee training programme, but
are reliant on your own personal abilities. (While many franchisors point out the diversity of the backgrounds of its franchisees, they still require candidates with communication and people skills.) These skills are not only useful in dealing with staff , they also help with customer relations too. As with any business startup, a franchisee will have to fulfi l a number of roles: manager, salesperson, entrepreneur, administrator and worker. An understanding of people and the ability to win confi dence are vital for building a successful business.
Risk averse
Starting your own business is taking a big risk. Buying a franchise reduces the risk. Ideally, you want to minimise risk as much as possible, therefore you should choose a strong franchise system with a proven business track record. If you are careful and thorough in your franchise research, so you know just what you are signing up for, then you will reduce the risk – do not minimise this research!
Is franchising right for you? Franchisors seek individuals with the ability to absorb and replicate their knowledge and systems and develop a successful business through a mixture of hard work and the proper implementation of their business concept.
A good mixture of the above attributes traditionally makes a great candidate for franchise ownership, so be objective in regard to yourself but also know that franchising is all about being in business for yourself, but not by yourself!
Nick Williams
is managing consultant of Ashtons, a franchise consultancy that helps companies reach their franchise development objectives.
March 2018 |
BusinessFranchise.com | 19
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