Choosing The Right Franchise For You: What Should You Look Out For
How do you choose a franchise? There’s a lot of choice out there when it comes to choosing a franchise. It’s important to understand what you, as a potential business owner, want to achieve. You will need to do some research before you commit to a franchise. We have explored how to go about choosing a franchise and put together a handy guide to, hopefully, make your decision a little easier.
Questions to ask yourself before choosing a franchise:
What are my personal goals? Your personal goals can help you determine whether a franchise is right for you.
What type of industry do I want to conduct business in? Do your research on the industries that seem like the right fit for you. This will help you determine the industry that will work best with your schedule.
What are my strengths? It’s important to look at your strengths before choosing a franchise as this can help you become a successful franchise owner.
What role do I want to play in the business? There are two types of franchisees: absentee owners, who hire staff to manage the business on a day to day basis, and owner/operators, who are directly involved in running the business. So, before you commit to a franchise, decide how involved in the business you’ll want to be.
What kind of commitment do I want to make? Most franchise agreements are multiyear contracts. While some are as short as five years or as long as 25 years, the average length of a franchise agreement is 10 years. This means you are committing to this opportunity for the long haul, as it can be difficult to exit a franchise agreement.
What is my investment budget? Before buying into a franchise, you should weigh the initial investment against your expected return, along with your income, lifestyle and equity goals. As initial investment costs can vary based on the industry you’re heading into, you need to determine how much you’re willing to invest and create a budget.
What to look for when choosing a franchise
A strong support system for franchisees - One of the biggest benefits of buying into a franchise is that the brand is already established. Take advantage of your franchisors knowledge to create a successful business.
Investment in your potential - Ensure that you get the sense that the franchisor cares about your professional success and growth within the company.
The franchisors professionalism - As you make your initial inquiries to the franchisor, take note of how they handle your request. Do they answer questions promptly and thoroughly? These initial first contracts are the most important for you to get a sense of how the franchisor operates their business.
Mutual expectations - You should be clear on what your potential franchisor expects of you and make sure the deal is a good fit for both parties before signing a contract.
Sales and business approach - Another important factor to consider is how the company tackles other sectors in the business like sales, marketing and advertising. Consider whether these methods will be successful in the current marketplace and if you can afford the tactics and campaigns.
Online reviews- To get a good sense of the company's business practices, you can research the company and its reputation. You can find information about a company on message boards, social media groups or articles where franchisees talk about their experiences with the franchisor.
What types of industries can I invest in:
When choosing a franchise to invest in, it’s important to do your research and make sure that the business will suit your long-term interests.
Food and Beverage Franchises - The most popular industry in the franchising field is the food and beverage industry. This industry has many opportunities and niches, from coffee shops to high end restaurants there’s a franchising opportunity for everyone. A recent trend we’ve seen is the increase of health food industries and we expect this will continue to rise throughout the years to come.
Beauty Treatment Franchises - £27 billion is spent on products and services provided by the health and beauty industry each year. This figure is predicted to increase by £2 billion by 2024.
Child Care Franchises - Childcare is a service that is required and will continue to be required overtime. It seems like a no brainer investment but it has to be an industry that you’re genuinely interested in, in order to succeed.
Cleaning Franchises - Another popular franchise to get involved in is the Cleaning Franchise Industry. Cleaning franchises offer the chance to launch your own cleaning company under a recognised brand name. The cleaning industry can be a good option for a first time franchisee as start up costs and overheads can be lower than those of other franchise opportunities.
Gym Franchises - The fitness industry has been booming in recent years. Buying a gym franchise is a great way to get into the highly profitable fitness industry, but it’s important that you find a profitable location and run your gym franchise business effectively.
These are a few of the most popular franchising options in the UK right now. These are projected to only increase in value so could be a good starting point for your personal research. Ultimately, you need to find a business that works for you, your lifestyle and you genuinely care about.