You have to ask --- IS a FRANCHISE FOR YOU?
There are NO guarantees. You invest your money and take your chances. My own experiences include franchises for personnel agencies, temporary help services, diet centers, restaurants and PC training schools.
Some of these franchises proved very important in our business plan and growth into a multi-million dollar enterprise. However, there were some expensive lessons that we learned through the process.
As with any business, you must determine whether or not to enter a particular venture. First, assess YOUR reasons for going into ANY business, not just a franchise opportunity. Your best decision may be to buy a franchise. On the other hand, you may not be ready for any business venture.
YOU must become a SUPER "snoop" or investigator. Ask the tough questions. You cannot expect exactly the same results as another owner of a franchise. If you are buying "brick and mortar" then it's location, location, and location.
Also, it's not only the location. Employees can make or break a company. Your investment in the company or your ability to fund the enterprise are factors. Your own leadership ability is a key element. "Links" are important, too.
It is imperative that you ask a lot of "what if" questions. What if? I stay with my present employer? What if? I go broke? What if? I don't LIKE the business? What if? my spouse does not like my "new" hours of work? What if? I don't like selling?
Why do YOU want your own business? Is it just a dream? Were your parents owners of their own enterprise? Franchise? Joint ownership, partnership? Again, YOU are your own person and must make your own decision. Family history of owning a business is NOT necessarily a guarantee of your success.
TIRED OF THE BOSS
Are you tired of your Supervisor or the Boss telling you what to do? Yes? That's not a good reason to "jump" ship. Operating a business requires more than a need for change or the desire to do as you please.
Business owners DO NOT get to do as they please UNLESS they "please" to spend most of their time worrying" or thinking about their business. Dealing with employees, payroll, benefits, vacations, sickness, children, spouses, vendors, customers, inventory, taxes, lawyers, accountants, auditors, IRS, EEOC, insurance, and more.
Purchasing a franchise requires TOTAL commitment. Your energy, your money as well as other assets (collateral) are required to back up your new venture. IF you are NOT prepared to invest these qualities and resources into your franchise, then STOP here.
EVALUATING YOUR SKILLS
Your experiences and potential success
As a first and often overlooked step, ask yourself why you want to purchase a franchise. This question, although basic, is an excellent way of evaluating your reasons for going into business. List every reason you identify, no matter how far-fetched it may seem.
Divide your list into two separate components. Separate the viable reasons from the trivial ones and categorize them accordingly. It isn't unusual for reasons to range from the desire to be your own boss to the desire to be a billionaire.
Consider the following questions:
Are you a leader?
Do you like to make your own decisions?
Do others turn to you for help in making decisions?
Are you willing to accept managerial assistance
from the franchisor?
Are you willing to comply with the provisions
outlined in the franchise contract?
Do you enjoy competition?
Do you have will-power and self-discipline?
Do you plan ahead? Do you like people?
Do you get along well with others?
Important questions need answers covering your physical, emotional and financial status. All part of being the successful business owner.
Are you aware and understand the "picture" of:
12 to 18 hour work days
six days, seven days a week
Saturday and Sunday schedules
Physical stamina required
Family strains and commitment
Reduced income possibilities
Risk of loss, your family savings
Risk of failure and starting over
Answering "yes" to all of the above means that you have some of the skills needed to operate a successful franchise and/or private business. A "no" answer means that you may have to acquire additional skills and/or talent through others or training.
Have you had any business training in school?
Are you willing to delay your plans UNTIL you
acquire the skills?
When you complete your self-analysis, discuss your results with your family and your financial advisor. Their feedback can help you make the right decision. If you all agree that you have most of the skills needed to operate a successful franchise, then you should feel comfortable proceeding with your plans.
If, however, they feel you lack most of these skills, then you may need to consider delaying your plans until you are better prepared. Above all, be honest and objective with yourself. It is YOUR future that we are dealing with in this analysis.
MY FIRST FRANCHISE
At the time, I was 30 years old and had already co-owned two businesses in my early years before 25 and had spent the last
4-1/2 years with an envelope manufacturer as an executive on the management team.
To make a long story short, I spent almost 2 years in this franchise before realizing we had too many chiefs (investors) and few indians (workers).
Very quickly, here's the point. The headquarters (franchisor) had a great track record in the "home" city and was making a lot of money. This is important. Why? Was there a "link" to the source of business? YES!
Our problem? We did not own or have the "link" that would turn the business into the same success story as the home office, the franchisor.
You have to look deep to find the details. A number of factors can be the "link" which makes your business successful. Let's name a few? it could be YOU, or a member of your staff, the location, unlimited financing, a large investor, new equipment and many more possibilities.
Be sure you KNOW the success "links". Sometimes they are hard to find but it is essential that you "discover" them BEFORE investing your money.
Action Tip: A franchised business has NO guarantee. You need a valid reason to begin a new business. Know that it takes full-time commitment from you and your family. You should know 'thy-self'. Leadership skills are required. Risk of failure is real and increase in skills level is important. Imperative to KNOW the success "link" in the home franchise.
Don Monteith spent 32 years in the Staffing business. His firm placed thousands of job candidates in their dream job. Today, he shares his expertise. Learn more by visiting his website at: