*Contributed by Sarah Morris.
Franchising is a business concept that is increasingly attracting a lot of wannabe entrepreneurs nowadays. Many consider it a good and safe starting ground in business. If you ever wanted to open your own restaurant business but can’t put up a huge capital for it, you might consider franchising an established restaurant. With so many options to choose from, it can be challenging to choose the right one.
To evaluate your choice, here are some telltale signs that you’re definitely investing in the right franchise business:
How to Join a Franchise: 5 Signs That You’re Getting a Good Business
1. There’s a noticeable industry and unit growth
This refers to the growth potential of the franchise business in your area and the number of franchise units they currently operate. Determine how many were successful and how many had to close shop due to difficulties. In your research, it also helps to include the franchiser’s overall financial strength and whether or not there were any litigations in their record.
While certain franchises may incur a few cases that could affect their reputation, make sure to also read closely on how they were able to resolve these problems and improve their business thereafter.
2. They have a good management team
A franchise’s management team is a reflection of their company values and how they wish to brand themselves to the public. During your research, it helps to identify key employees of the company and learn more about each of their employment history. Additionally, you can also arrange a meeting with them to gauge their attitude and competence in delivering answers. Check for the following:
- Are they able to provide clear and concise answers?
- Do they minimize certain controversial events from the past?
- Do they exaggerate or oversell their company brand too much?
- Are they able to provide accurate data to support their claim?
- Can they lower operational costs so you will have a better return on investment?
3. They offer financial and marketing assistance
While operating a franchise is certainly up to the entrepreneur’s skill and ingenuity, most franchises actually offer tools and resources that help ensure your success. Some of which may include financial assistance, which can be reflected in their business plans and tools that ought to teach you how to make a profit.
Additionally, a great franchise also provides marketing assistance. This involves providing programs and platforms that can help you promote your business to various channels. This can be either:
- Traditional – such as fliers, brochures, billboards, and print ads
- Digital – which is done through social media, content optimization, and other online marketing means
All of these could either be provided in a package or given with additional support.
4. They offer training
Aside from the tools and resources in helping you get started, a good franchise business also offers appropriate training that can help you operate the franchise unit according to their business model. Additionally, they may also provide other training opportunities such as:
- The company’s standards and procedures
- Technical information on the different products and services offered
- Leadership and management skills
- The different techniques in training staff members
- How to provide proper customer services
- Problem-solving skills during operations
With so many factors that can affect a business, a great franchise will always invest in making sure their franchisee succeeds by including supplemental support.
5. Other franchisees are satisfied
Last and certainly not the least is the feedback of franchisees regarding the business. To know this, you need to connect with current and former franchisees and ask them about their overall experience in working with the company.
Some questions you may want to include in your research are the following:
- How was your experience working with the franchise?
- Were the training and resource materials adequate?
- Did you have any problems with running your own business unit?
- Were there any concerns or issues between you and the franchiser?
- How did the franchiser solve any of the issues you had?
- How would you rate your overall experience?
Keep in mind that while opinions can be biased, it’s still better to work for a reliable company trusted by many instead of investing in one with a controversial past.
By looking at these signs and applying these tips, budding entrepreneurs can rest well knowing that they have made the right investment. While a franchise can provide benefits that can help you get started, one must also take the initiative to constantly innovate and challenge their business to become better to secure financial progress and success.
*Contributed by Sarah Morris.