There are many reasons why a person might consider starting a franchise with a well-known parent company and the success largely depends on 3 things; 1) the product or service 2) the franchiser and 3) your level of commitment. Of course, the franchiser is selling their already successful brand and you need to carry out some in-depth research into this organisation before doing anything. We asked a well-known business guru what makes a great franchise opportunity and here are their answers.
- Known Brand – The parent company should be a market leader that has already enjoyed a high level of success and using their formula, you will be replicating their services in a specific region or area. The company should have been in business a minimum of 5 years and using the Internet, you can discover a lot about their reputation within the community.
- Adequate Resources – It is never ideal if the franchiser is stretched regarding resources and if they have the right organizational structure, they can provide you with the essential support that you will need to be successful. Take a good look at the package they are offering and if you have a few questions, do discuss them with the franchiser; they are as eager as you for your business to take off, so it is a winning combination. The downside to franchising is that you are very much controlled, which is necessary for the parent company to ensure the quality of the product and service, while some would say it is not a downside, rather a formula for success and why change it?
- Logistical Support – The level of support you will need depends on the chosen field but it should be evident and cover every aspect of the business from bookkeeping to marketing and everything in between. If you would like to get in the current fitness trend, there are some great gyms for sale, with locations carefully selected by the mother company. Prepare a list of questions for the franchiser and carefully read all literature received; you are both working towards the same goal and with their expertise and your energy and dedication, you are sure to make your mark within the local community.
- Service Demand – It isn’t difficult to do some online research into the parent company and the sector, which will give you the information you need. Take a look at other franchises that are already operating and talk to the owners, as this will give you a realistic picture of what to expect. There are two ways a growing business can expand; they can open new branches, take on more staff and invest everything that is needed to do that, or they can franchise the region to a third party. Many growing businesses prefer the franchise, as they do not need to take on any more than they can comfortably handle and with a small slice of the pie, they are happy to be developing their brand. There is great article for you to read is about quick tips for first-time business owners.
Here is some Australian government information on buying a franchise, which is a recommended read for all considering taking on a franchise.