7 things to consider
1 - Know Your Motivations
You want to own a business. The power, the independence; calling the shots and being your own person. At the same time, job insecurity, being responsible for everything while perhaps putting food on the table for dependents are all daunting obstacles. Reward doesn’t come without risk, so you want to be smart on what you risk possibility your life savings on in order to pursue your passion or gain independence. Make sure you have the risk tolerance it takes to stick your neck out for a less stable but hopefully more fruitful future. It’s not for everyone.
2 - Make Sure You are Interested in Being a Business Owner Versus an Entrepreneur
In this search, the decision of starting your own business and structure versus being a business owner through a model that has already been created is a very important facet of your research journey. A franchise is where you a business owner as opposed to an entrepreneur. The franchisor has the business ideal, model, know how and path and you follow it. In exchange, the franchisor and franchisee agree upon a compensation structure for shared risk and reward.
3 - Take Stock
Whatever your motivation is, now you find yourself thinking about what kind of business you want to open. Maybe you already have something you like doing, and maybe not.
So where do you start? First, it helps to list out the traits you possess that are the strongest and the skills you have that are the most marketable. When you have that list accomplished, you may think that the skills that you have are good but the life that you lead doesn’t lend itself well to becoming your own boss without some help. Therein lies the franchise model.
4 - The Hub
The hub of franchising is the International Franchise Association (IFA), so one of the best places to start is there. The IFA is the 80-pound gorilla of franchising worldwide and is the most influential organization in the industry. And the site doesn’t disappoint. Under the “Franchise Opportunities” section, you can research by industry, by name, by the size of the investment and by the location (even internationally).
5- The Spokes
If the hub of franchising is the IFA, individual franchisors and vendors such as franchise consultants are its spokes. Therefore, concurrent to your research, you may want to hire a franchise consultant to navigate you through the process of choosing which franchise that would be the best fit for you. If you already have opinions, you can contact the franchise directly. The IFA and other franchise organizations have continuous roadshows where franchisors have booths set up you can visit and speak with the development agents directly.
6 - Sealing the Deal
If you become more interested in a particular franchise, you reach out and they pre-qualify you. Pre-qualification comes through financial and personality fit. If those are a match, you are invited to a day where you learn even more about the brand. If that’s a fit, the franchisor and you come to a paperwork agreement of how to do business. Following those steps can be build out, training and marketing. Finally, you have a franchise and are running it!
7 - Happily Ever After?
Hopefully, the end of story is that you are running a successful franchise unit. Opportunities that exist to expand on your opportunity include becoming a multi-unit operator, area developer and multi-brand franchisee. If life is not how you envisioned, there are provisions to sell to another franchisee, sell back to corporate or shut down depending on market conditions. Any business takes effort, time, tolerance and perseverance. By going through these steps, you will be on your way to narrowing down your research into a more organized trail that leads to your destination...