Franchise Opportunities – Where do I start?
Choosing a franchise can be a positive experience or a shot in the dark investment. Like most decisions, a systematic process for exploring and evaluating your options makes it much more likely that you'll be happy with the outcome. This guide will make your research faster, easier and more productive.
Business Franchise Opportunities - Self Assessment
Before looking at the vast amount of franchise information on the web, take a look inward.
- Available Capital – Will you be financing your franchise on your own, or considering loans? Franchises often require new franchisees to have far more capital than they'll typically use, because insufficient capital is the number one reason for franchise failure. Here are a few popular financing options you might consider:
- Franchisor Loans: Some brands offer to finance their franchisees.
- SBA Loans: The Small Business Administration offers loans to qualifying applicants.
- Commercial Bank Loans: Available at your local bank branch.
- Time Commitment – Many franchises require an owner to be present for a majority of business hours. How many hours are you able to commit?
- Goals – Why are you starting a franchise in the first place? Most people go into the process with something specific in mind, and recognizing that is critical to fulfilling it.
Top Franchise Opportunities - Industry Assessment
Analyze the industries you're interested in to make sure you're picking one with good opportunities.
- Historical Trends – Has the industry been growing in recent years? Are franchises in the industry successfully adapting to changing customer demands?
- Short-Term Projected Growth – The first few years are going to be a struggle for survival as you build a customer base and awareness for your franchise. You don't want to be competing for a shrinking market during this period.
- Long-Term Projected Demand – Will your services still be in demand in 15 years or however long you plan to work?
Best Franchise Opportunities - Franchise Assessment
Common Mistakes to Avoid
- Don't limit yourself to franchises you're familiar with. A franchise offers a lot more than brand awareness – proprietary tools, training, marketing, and methods should be a major part of your selection process.
- Don't write off a brand just because its franchise fee or capital requirement is above the industry norm. The franchise fee usually reflects the level of value you should expect to receive.
Bottom Line: Give more weight to the services the company offers than your initial impression.
Steps to Get Started
- Browse through the opportunities in your industry. You can access our database through the 'Search By Industry' tab at the top of this page or narrow your search to our low cost franchises.
- Review the capital requirement to make sure you qualify.
- Pick out about 5 to explore further and you're well on your way.
But she's doing it: Can franchisors treat franchisees differently?
So, what do you do, then, when your fellow franchisees start using rougher towels, or take the milkshake off of the menu? Now all of a sudden some of the inherent value in your franchise is gone. Your hotel chain is seen as declining in value, and out-of-towners stay away because they think that you, too, have taken their favorite milkshake off of the menu.
4 Signs a Franchisor May Not Be Around for the Long Haul
A critical part of the due diligence process for prospective franchisees is trying to discern (to the extent reasonably possible) whether the franchisor will be around for the long haul. After all, much of what you pay for in a franchise opportunity is the right to be associated with the franchisor’s brand and system, the right to use the franchisor’s proprietary materials, and in some cases, the right to an exclusive territory. If the franchisor goes out of business, all of these rights go up in the air (if not out the window), and you may well be left in a worse position than if you had just gone into business on your own in the first place.
Territorial Issues and Franchising
Did you know how important picking a good location is when buying a franchise? Read on to find out more!