1851 Growth Club: How to Determine the Right Franchise For You

Nick Powills, publisher of 1851franchise.com and CEO of The 1851 Growth Club, recently shared insights on how to choose the right franchise. When you are deciding on a franchise, you should consider the following: the size of the brand, the leadership of the brand, the product the brand sells, validation throughout the process and the support the brand will provide you. 

The Size Of the Brand

The size of the brand should be one of the first factors you consider when deciding on which franchise is the right fit for you. You might be tempted to select a brand that is widely recognized and dominating its industry. However, this is not necessarily the best choice.

“It's essential to recognize that some franchises are giants in the industry,” said Powills. “However, this can come with limited territories, making it difficult to secure a location in your preferred area.”

For example, consider what it would be like to call a McDonald’s or a Chick-fil-A. You might struggle to get through to the right person. 

“Emerging brands offer a different perspective,” said Powills. “They are on the rise. Assessing their growth indicators, especially in the last year, can be telling.” 

Powills also advised prospective franchisees to turn to existing franchisees for an honest outlook. 

“An even more critical question to ask is about the growth of existing franchisees,” he continued. “If, for instance, five franchisees were supposed to open their second units in year two but haven't, it suggests misaligned expectations. This doesn't necessarily mean it's a bad brand, but it's something to explore further.” 

Another thing to keep an eye out for is the attitude of franchisees; if they are positive and enthusiastic, that bodes well for the brand regardless of its size. 

Multi-unit deals require extra caution and deliberation. Powills recommended “discussing the first right of refusal with the franchisor.” He also believes that starting with three units typically provides the right stability for scaling in the future. 

Leadership

Meeting the leadership team is a vital part of the decision-making process. This team will play a pivotal role in your franchise journey. 

Powills noted that prospects should “feel confident and comfortable” with the franchisor and its leadership team. Look at their track record, as they have the power to “positively impact your growth.”

Product

When it comes to the product, differentiation is key. However, if the product itself does not have a lot of room for differentiation, the strategies at play still can. Fun fact: If Powills had to select a food brand today, he would opt for a self-serve frozen yogurt brand. 

“Despite minimal product differentiation in the industry, the concept still has potential,” said Powills. “Consider focusing on unique strategies to set yourself apart.”

Validation

Validation is vital in any business decision, and the best source for information about a franchise opportunity is the individual franchisees running the day-to-day business. 

“When franchisees express enthusiasm and a willingness to repeat their decision without hesitation, it's a positive sign,” explained Powills. 

However, he suggested being wary of neutral feedback during your validation process; that may be an indicator of a lack of passion. 

Support

As a franchise owner, the level of support by your chosen franchise will make a world of a difference to your experience and your chances of success. 

“Don't settle for mere lip service; delve into how the franchisor genuinely supports franchisees,” said Powills. “Ask about their visit frequency, grand opening assistance, supply chain management, technology plans and marketing strategies. Remember, buying a franchise means taking control of various departments, so comprehensive support is crucial.”

Making A Decision

Once you know the franchise opportunity aligns with your entrepreneurial goals, these six guiding principles will help you complete your due diligence before signing on the dotted line.

Support in your decision and further opportunities are available through 1851franchise.com and through the Growth Club. 

To learn more, click here.