8 steps to choosing the right Franchise Business
The organized business models and straight-lined operations backing a business identity always facilitate the walk for the investors in the business journey. Systemized procedures have always been a proven formula for making the grade in the business. Since franchising follows the aforementioned models, it can certainly be the future of businesses in India. However before you enter the world of franchising, you need to choose the right franchise system for you. Following are the points to consider while choosing the type of franchise system.
1. Understanding the Advantages of Buying a Franchise over Opening your Own Business.
To begin with, you need to make a decision whether you want to buy a franchise or open your own business. To decide and choose between the two, you would need to evaluate the pros and cons of both of them. If you buy a franchise, you operate under an established brand that is already well-known whereas if you open up your business, you need to begin from scratch and it easily takes years to generate the trust for the brand. Also when you start a franchise, you can make the most of the franchisor’s already established business relationships with marketing and supplier teams. In your business you have the complete liberty of making unhindered decisions unlike in buying a franchise where you need to follow some rules. However the security, orderliness and the goodwill coming along with the franchise is most likely to overweigh the pros of starting a business from scratch.
2. Know What You Want from Business:
Before you consider buying a franchise, it’s important to self-evaluate as to what you want from business. This step would help you understand your own motivations behind committing to the franchise. Following are some simple and obvious questions you need to ask yourself in order to know what you want.
• Do you want to be on the Frontline or step back to manage the business?
• What’s your priority- Challenge of running your own business, financial stability, or flexibility?
• How much do you want to invest?
• What returns do you want from your investment?
Once these questions are answered, you begin to get a clearer picture of what you want, leading you to choose the right franchise system later on.
3. Self-evaluation of Your Skills:
Once you know what you intend to get from your business, it’s also equally important for you to analyse who you are and particularly what are you good at. You need to examine your skill sets. You should know what you’re comfortable with, what disposition you have acquired in your professional experience. You also need to know if you like interacting with customers behind the counter of a retail location or being out in the field working with clients and customers.
4. Consider your Financial and Time Investment:
Before buying a franchise, you’ll need to have a clear idea of how much money will be available to you. Most of the franchises would require that a franchisee has a certain amount of finance to start his business. Also, ideally one should have capital higher than the money needed to open the franchise business. Buying a franchise is a major investment consideration, big or small, so it’s good to figure out if you’re able to do so as of right now. However, owning a franchise not only costs you money/finance but time too to invest in. Running a franchise means you need to take time to learn how it operates the rules, hiring and managing the staff.
5. Blend of Passion and Profitability:
Running a franchise and make one’s mark indeed requires tremendous dedication on the part of a franchisee. The level of dedication would be the result of passion within you. The passion makes it love’s labor to run the franchise. Also, obviously one should invest in the franchise yielding maximum profit. The more you invest, the more chances you stand to earn the profit.
6. Research Well:
Before buying a franchise, you need to research upon the following factors to make sure that you’re buying a right franchise. To begin with, it’s important to make sure that you get ample support through every stage of your franchise and get sense that the franchisor cares about your professional success and growth within the company. You also need to inquire about the sales and advertising approaches of the franchisor.
7. Study the Franchise Agreement.
A franchise agreement is a legal contract wherein the franchisor consents to grant the trade name or business system to an individual or franchisee. It’s important to study the franchise agreement along with understanding the advantages of it. The franchise agreement provides the investor with a product, recognition and support system. It enables to avoid the costly and complex litigations in case of a dispute and allows the franchisor to set a standard of quality with regard to the various aspects of a business before signing on the franchisee.
8. Meet the Franchisor:
Before deciding if a particular franchise is right for you or not, all franchisees need to meet the franchisor. At this stage, you can get your final questions answered. This step is a critical check- and- balance to make sure you’re completely confident and comfortable in the company you’re about to enter into.
Once you’ve completed the preceding eight steps, you would be able to take a final decision. To make it a cakewalk for you to find a right franchise, Franchise Insider is one stop platform for all your questions, doubts, and problems. We turn your dreams into reality. When you knock our door, expect the best!
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