Over the past 25 years, FranNet has guided thousands of interested franchise owners towards the right business fit.
“Buying a business is a life-changing decision, and you’ll want to know as much as you can about a franchise before you buy into it,” says Jack Armstrong of FranNet of Northern/Central New Jersey. “You’ll also want to take a critical look at yourself. Like any career, there are good and bad fits. What I try to do is make sure that the right person winds up buying the right business so that they’ll be happy and successful.”
FranNet has plenty of advice to offer potential franchisees. To start, here are five tips:
1. Franchising is more than just French fries. A lot of people who think of franchises automatically think of restaurants or hotels. That was a fairly accurate portrait of the franchise industry 25 years ago, but there are many new kinds of opportunities today. We’ve found that professionals often find the most success and satisfaction working in a completely new field.
2. Have working capital. Make sure you have a buffer. New businesses take a little time to start generating profits, and you’ll want to have cash on hand to cover expenses and pay for extra marketing. It’s great to avoid debt, but it can be worth taking out an SBA loan in order to preserve working capital.
3. Talk to top performers. Nobody wants to be average or low-performing, talk to at least two of the top 10 franchisees in the system and find what makes them successful.
4. Evaluate systems. When you buy a franchise, you are buying business systems. Efficient systems are what often gives a franchise an advantage over a mom and pop operation. Look into how well documented the systems are and how tested and proven they are, including the point of sale system. The better the system, the better the franchise.
5. Don’t be afraid to ask questions. There is no such thing as a stupid question — not when you are considering a life-altering decision. Franchisors owe you solid answers before you invest in their concept.
FranNet is a privately-held franchised business consulting company. FranNet opened in 1987 and is headquartered in Louisville, KY.