Is it difficult to run a franchise if I’ve never run a business before?
Buying into a franchise is not difficult at all. The challenge lies in selecting the right franchise for you. One that can make best use of your skills and experience. A business which will challenge you enough so you don’t get bored, but which doesn’t overwhelm you. Ideally, one which sees a dovetailing of your skills, ambition and hard work with the business model, systems, collateral and brand of the franchisor.
For example, a good franchisee of a people centric business will be comfortable managing different kinds of people, happy dealing with different types of customers and meeting with managers of other businesses.
Other types of franchisee may be good at developing personal relationships, or focussed more on becoming passionate about their business area, or customer service etc.
At Franchise Talent, we believe it isn’t about how easy it is to buy into a franchise, but the focus needs to be on finding the right franchise for you.
If you’re interested in having a no obligation and free conversation about how we can help you make that decision, please get in touch.
If I need help with funding, how did I get it to buy into a franchise?
A number of the high street banks have specialist and experienced franchise departments and they should be on your shortlist of people to approach – always see more than one and compare interest rates; payback period; free banking terms; capital holiday and secured / unsecured options. Additionally though, you should give thought to other forms of funding – you would be amazed by how much you will be able to raise from your own arena – extending your mortgage; cashing in investments; loan from family members and so forth. Furthermore there are other loan companies who will also look at franchising such as lease financing.
Whichever route you choose please ensure that you are comfortable with the lender; that you have compared lenders and most importantly that you get the balance right – neither over-extending yourself nor under-capitalising your business.
How can you judge if a franchise is resilient?
As with anything in life it is never easy to predict the future and no business is ‘guaranteed’.
However, these are our first 10 steps you can take to evaluate the robustness of a Franchisor and their business:
- If they are members of the bfa then the franchise will have undergone rigorous checks
- If the business has been going for a number of years then there is a better chance that they have been through economic turmoil’s
- Look at the level and quality of support from the Franchisor – do they proactively cover marketing, training, operations, and finance as the key aspects of any business?
- Check that the Franchisor has real support people – not just ‘telephone support’
- Does the business have multiple income streams? – or is it reliant on one product or service?
- Does the Franchisor make most of their money through on-going royalties based on franchisee performance (our favoured) or mainly through recruiting new franchisees?
- Does the Franchisor have a history and reputation for introducing new products to their network?
- Ask for the last 3 years accounts of the Franchisor
- Speak to a selection of franchisees
- Ask the following – do you feel the industry is robust? Is there a big enough market in your territory? Can this franchise successfully access the market?
Am I a good fit for franchising?
It’s very rare that anyone wakes up in the middle of the night thinking “I must become a franchisee!” Franchising is not a simple decision, but that is where Franchise Talent comes in.
When you’re thinking about running your own business, you may have a whole host of questions you’d like answered. For example;
- How do you start?
- Who can give me advice?
- What business should I open?
- Who’s done this before?
- What were the results?
- Am I the right kind of person to run my own business?
- How do I deal with sales and marketing?
- How do I set up the IT I need?
- What about bookkeeping and accountancy?
We expect you to start this process with lots of questions. We’re here to help answer those questions for you, (get in touch, that’s what we’re here for!) but whilst you’re getting your questions together, take a good look at yourself. You need to be honest with yourself. We’ve noticed these common traits across many successful franchisees. Do they apply to you too?
Working with the franchisor’s business system: Whilst all businesses need original ideas – adhering to the systems used in the franchise you’re buying into is critical. Remember, for this business to work, cruising along isn’t enough. Show growth and a keen sense on developing your business in tandem with the franchisor’s knowledge and experience and you’ll quickly move onto the next stage.
Structure, focus and organisation: Running any business yourself is hard work and requires structure and organisation. You have to get a lot done so you have to develop planning and organisational skills in order to get things done.
Good communication: The ability to relate well to clients and customers, to suppliers, and other business contacts is critical. If you can’t build relationships with people then you won’t be successful in running your own business where you don’t have anyone you can hide behind.
Recognising that owning a franchise is not the same as ‘having a job’: Whilst the rewards of owning your own business in the form of a franchise are often huge, there’s no getting away from the fact that you, and you alone, are responsible for this success. It can be hard work, covering lots of areas that perhaps you haven’t worked in before. It’s not for everyone.
Ready for hard work: There’s no two ways about it, you have to be prepared to work hard. If you are, great, you could be joining the many thousands of people every year who change their lives for the better and run their own business through franchising. But we need to be clear, particularly in the set up stages of the business, there’s nothing else which can replace the ability to put in long hours.
I have never owned a business before, how difficult am I likely to find buying into a Franchise?
Buying into a franchise is not difficult at all – but buying into a franchise that’s right for you is what’s important.
Good franchisors want franchisees who themselves are committed to the business proposition – who understand that owning a franchise is more than ‘buying a job’.
The essence of good franchising is the dovetailing of the skills, ambition and hard work of the franchisee with the systems, support, collateral and brand of the franchisor.
A good franchisee of a people centric business for instance will be comfortable managing people, dealing with all type of individual customers and meeting with managers and owners of retails stores.
Other types of franchisee will be good at developing personal relationships; and becoming passionate about their business area and customer service and so on.
So it’s not about how easy it is to buy into a franchise but more about determining the right franchise for you.
Is age or gender a barrier to buying a franchise?
We’ve seen male and female franchise owners with ages from their early 20s into their 60s successfully run franchises. Age and gender are not an issue, what is, however, si the ability to perform – to have the drive and ambition to give 100% to making your business succeed.
Businesses don’t fail because the owner was ‘too old’ or the wrong gender. With all the different franchising options available, success really comes down to how well matched you are to your chosen franchise. This is the service Franchise Talent can provide to you – free of charge and with no obligation. (We receive a fee from whichever company you choose to take a franchise with – if you decide to go ahead – again, there’s no obligation required of you).
Whilst we make a point of judging every potential franchisee on their own merits – business success relies on so many different variables we’d be mad not to – there is a school of thought which says prospective franchise owners of more mature years are more willing too follow the system and work in tandem with the franchisor than younger franchisees.
Age brings certain advantages with it – experience and maturity – we hope! But also a sense of purpose and stability sometimes.
But however old you are, and whichever gender you belong to, remember, when franchise owners are looking to who they are willing to work with, they value good organisers, strong communicators and people with passion. Whether you are in your 20s or 60s, male, female or you’d rather not say, these are the attributes which really count.
If you’d like to find out more about how Franchise Talent can help advise you starting your own franchised business, please get in touch.