Thinking of buying a franchise? Today we have Pippa Highfield’s second post on franchising. (If you missed her first post, here it is: Five reasons to buy a franchise)
Having searched ‘flexible, part-time jobs in north Bucks and Beds’ for the millionth time and still come up with nothing I realised I needed to be a bit more creative. I didn’t set out to become a business owner, less to launch the Bedford edition of Raring2go! – a guide aimed at local families – but here I am four years on operating a profitable franchise business that can be run during school hours.
Being a fairly cautious and risk adverse person I did a lot research before I signed the agreement to take on the franchise and here are some of the key questions I asked:
Do you believe in the product/service? Being passionate about the product or service you are offering is a key business success factor and the same is true in franchising. Can you see yourself being enthusiastic about your business and feeling proud of what you do?
Is the business idea viable? If the business has been in existence for sometime and you have a verified set of accounts this can really help you analyse the opportunity. If the business is relatively new it is important to ascertain how the franchisor has come up with their financial projections.
You should also be mindful of how the product will be received in your local area. What is the level of competition for similar products in your location and is your territory big enough to sustain another competitor? Does your area have a similar demographic to other successful territories already in operation?
What are your obligations as a franchisee? Not only is it important that you take legal advice before signing a contract, but you need to be clear about your day to day, month to month and year to year obligations to the franchisor. It is important to read your contract and make sure you understand what is required of you and build any requirements into your working plan.
Can I work with the franchisor and other franchisees? Like any other job it is important that you are comfortable with the ethos of the company and your ‘colleagues’. Make sure you meet your franchisor and their support team plus get in contact with as many franchisees as possible to get a real ‘feel’ for how the network is run.
What value am I getting for my franchise fee? There should be lots of tangible benefits of being part of a franchise such as training, technology support, marketing support, business advice and possibly a centrally managed website. The franchisor should also be marketing the brand centrally and expanding the network of franchisees, both of which will positively benefit your business.
This is by no means a definitive list of questions you need to ask when considering buying a franchise but will, I hope, give a flavour of some of the issues you will need to investigate before making a commitment. There is lots of good information available from organisations such as Business Link and the British Franchise Association which will help you analyse and asses a franchise opportunity for yourself.
After four successful years Pippa is now planning to move on to new projects. So if you think franchising could tick your boxes and would like an informal chat about taking on the Raring2go! Bedford franchise please contact Pippa on 01908 583232 or firstname.lastname@example.org