So, You Want To Buy a Franchise? Here Are Some of the Basics You Need To Know

Franchising, though business ownership, is inherently different from other types of business or employment. If you’re considering entering the industry, here are some things you need to know to help establish your foundation.

First, let’s start with some facts:

• You will need to go through a rigorous approval process. This should include your own due diligence on the brand as well.
• There will be a franchising fee, startup costs and recurring royalties paid to the franchisor.
• The franchisor gives you the plan, but it doesn’t do all the work.
• Franchising does not come with any guarantees. It is an investment, so you need to make sure you are confident in your choices.
• Different franchisors offer different levels of support. Understand how much you need and how much you will be receiving.
• Some franchise systems place a huge emphasis on culture. Decide if this is important to you and choose accordingly.

“Franchise ownership has similarities and differences from previous jobs,” said Lauren Coulter, director of franchise sales & development at Biscuit Belly. “In franchising, there is typically a proven process and plan that, when executed properly, can attain great results. To me, this is similar to what people may experience in corporate roles. Companies figure out what works, then just rinse and repeat.”

However, part of the beauty, and perhaps the pressure, of franchising lies in the flexibility. Sure, there are certain steps and protocols you’ll have to follow in compliance with the franchisor’s rules, but a lot of business-related decisions are up to you — the business owner.

“Franchising can be different from corporate jobs in that you can usually do a lot to manage the company on your own terms with you being the final decision maker on a lot of things,” she added. “Want to outsource everything? Go for it — you may take home less. Want to work through the night and sleep all day? Go for it. Want to be a super-engaged operator and likely bring home more than you would in a corporate role? Go for it!”

So, you’re going to go for it! What are the common missteps of your predecessors? What should you maybe be a bit less concerned about?

You Probably Have a Pretty Good Read on Your Level of Expertise

“People typically come in knowing they are not the expert and are looking for a plan to execute,” Coulter explained. “They can typically be incredibly engaged in that they are looking to be involved in the process, contribute to improvement and be a part of franchising communities.”

You’re new to franchising, but you know that. Don’t think too hard about it! Understanding what you do and do not know is powerful, and that will set you up well to contribute where you can and stay silent when it’s your turn to listen.

Even if you are acutely aware of how little you know about the operations or strategy of the specific franchise system you’re entering, do not let that uncertainty or lack of knowledge completely overpower your passion. You’ve entered this space for a reason, and being engaged in processes, brainstorming and community involvement is possible at any point in time; your passion can carry you through these aspects of the business.

You May Not Realize Just How Much Time You’ll Need To Commit

Many of the most successful franchisees have recruited a team of experts to help them lead their businesses, but this isn’t always attainable for new owners.

“I think franchisees often underestimate just how much of their time will be needed to run the operation. This isn’t just the case when you first start out. It is a lot of work, and while you have a template in front of you, you still have to do a lot of the execution,” Coulter explained.

She also called out accounting as one of the primary struggles franchisees face, saying, “unless you have a background in that, it can be very difficult to grasp all that is required on that front.”

Owning a business takes commitment. One of the primary things franchisees point out when telling their stories, or the ‘one thing they’d tell a new franchisee,’ often revolves around time. When you’re trying to get an operation off the ground, you have to dedicate the time to make it happen. Once you’re running a bustling business, you have to dedicate the time to take care of all of your clients!

Despite the time commitment, Coulter says the job is absolutely rewarding. “I love being a part of something bigger than myself. It gives me joy to be a piece of something greater.”