Franchise

Here are My Key Questions To Ask Before You Invest In A Franchise

We know investing in a franchise requires thorough research. Investors must not only grasp the initial costs and financing choices, but they must also thoroughly examine the franchise model, the franchisor's experience, the franchisor's approach to running the business, and the franchise's culture.

Future franchise owners must assess their skills, limits, and work-life balance objectives. They must also research the franchise to ensure that the franchise system they select is a good fit for their personality and long-term ambitions. The extra effort put in on proper research will pay off in the end.

Here are my five questions you should consider before purchasing a franchise.

1. How much is it going to cost?

The price of a franchise varies substantially depending on the industry and the brand within that industry. There are a variety of charges that go above and beyond the original investment range, especially for well-known franchises.

Almost all franchisors charge their franchisees a one-time upfront fee known as the franchise fee. As a result, you are obtaining the right to utilize the franchisor's brand and business model and ongoing management, training, marketing, and support from the franchisor. Furthermore, most franchises will require ongoing royalty payments once the franchise is established.

2. Does the franchise provide financing?

Most franchise investors finance their franchises themselves. However, you may take advantage of many franchisors' recommended lenders. They are more inclined to give finance since they are familiar with the franchise's business plan.

3. How satisfied are the existing franchisees?

During the exploration phase, it is critical to interview current franchise owners. Current franchisees may tell you how life is on a daily basis, what their main challenges have been, and whether or not their relationship with the franchisor has been satisfying.

Speak to as many franchisees as you can. They may be busy, but they recognize the value of building their brand.

4. What type of support and training does the franchisor offer?

Franchise ownership necessitates not just monetary but also time investments. The early phases of establishing a franchise can be challenging, and you will require guidance and assistance throughout time. You want to work for a company run by experienced people who have built a tried-and-true model that will expand with your company.

Franchisees should offer training programs that include all areas of owning and maintaining a successful business, from basic and ongoing training to marketing and advertising assistance.

5. Is the franchise a good fit for me?

Do your core beliefs, talents, and goals align with the franchise system? As a franchisee, you will be expected to sign a long-term contract and conduct your business under a set of requirements. Therefore, franchisors can be quite diligent in implementing standards and procedures to maintain uniformity and ensure future success within a franchise system.

Purchasing a franchise is a significant investment that demands a significant amount of time and effort. The most successful franchise owners, on the other hand, actually like their business and are willing to put in the work required to make it a success.

If you are interested in learning more about franchising opportunities, schedule a call here.

Here’s How to Restart Your Entrepreneurial Dreams After a Financial Setback

I realize a financial setback can be difficult to bounce back from. Finances can be a major impediment to beginning your own business. However, there are methods to avoid high-cost investments and obtain funding. So, if you've recently had financial difficulties and want to get back on your feet in the business world, start here.

Here are my recommended four viable strategies to restart your dream business.

Make A Plan For Your Finances
There are several ways to fund your business that do not require you to use your funds. However, you should not disregard your accounts. If balancing the books is challenging for you, it may be worthwhile to hire a skilled CPA familiar with Quickbooks to help you get your finances in order.

Outsource Necessary, But Time-Consuming Tasks
Outsourcing the tasks that consume your time is essential for a successful entrepreneur. For example, a business owner's time is frequently better spent on creative or higher-level work than writing emails or filling out inventory sheets.

As a result, regardless of the model you pick, outsourcing can increase your production while decreasing your costs.

Explore Financing Options to Assist You in Realizing Your Franchise Ownership Dreams
Franchise ownership does not have to cost millions of dollars to invest like a startup might. Whatever your business, there is a financing solution to help you get back on course as a business owner.

Financing is often available from your franchisor, commercial bank loans, Small Business Administration loans, or other lenders.

Your Marketing Budget Accounts For Half Of Your Financial Struggle
Spreading the word about your new company is vital to its success. Consequently, to get your business off to a solid start, you'll need a smart marketing strategy.

With a few mouse clicks, you can begin promoting for free. Creating a local social media profile for your company is a fantastic first step for physical businesses or restaurant franchises. After all, the more familiar you are with your customers, the more likely they are to return to your establishment.

Whatever road you take in entrepreneurship, planning your funding is a critical step toward success. Even though you've had disappointments in the past, each day is a fresh start.

Are you ready to learn everything there is to know about franchise ownership? Schedule a call here.

My Solutions to Move Beyond Your Franchise Fears

What holds many people back from owning a business is fear. Most are afraid the business will fail, and the investment will be gone.

Common Fears of First-Time Franchisees

Many people invest in a franchise to reduce the risks of owning a business. However, even when considering tried and true franchises with outstanding track records, you can expect various fears to interrupt your thoughts of owning one.

Here are some straightforward solutions to cope with these fears.

1. Investment Risk
Pick a franchise where the owner’s role fits your strengths and skills to minimize risking your significant investment.

2. Underfunded
Many early business closures are due to insufficient cash or working capital. Franchises reduce this risk in three relevant ways.

First, the total investment amounts are provided in writing in the Franchise Disclosure Document (FDD). Second, during the fact-gathering stage of a franchise evaluation, prospects should ask other franchisees how much the upfront costs were and how much working capital reserve they needed. Third, franchises have minimum financial requirements which must be met.

3. No Experience
If you chose a franchise based on your skills, the fact that you have no prior experience with the industry or company type should never be an obstacle for you. Keep in mind that franchisees give extensive training on their specific business as well as continuing assistance during your career with the brand.

When you match a franchise to your abilities, you can be confident that the type of business you are purchasing is most suited to your strengths.

4. Making Mistakes
You're afraid of making costly mistakes, whether due to a lack of technical abilities or just making a poor judgment call. After all, this is your first franchise and probably your first business.

The solution is to confirm the level of training and assistance supplied by speaking with current franchisees who have almost definitely faced every decision-making circumstance you will face. So you're only a phone call, text message, or email away from getting first-hand guidance.

5. Competition
Everything about the franchise is tailored to you, your budget, and your objectives. But you're worried about too much competition.

The remedy to this worry is to ask the franchise salesperson a few questions.

What are your competitors' names?
How can you set yourself out in a competitive marketplace?
What is the franchise's definition of territory?
Where can I find the nearest franchisees in the area?
Is the market saturated? What led you to this conclusion?
What is the franchise's marketing strategy?

6. Fear of the Unknown
Your franchise success depends upon the franchise you select, the quality of advice you receive, and the skills you bring to the business. A franchise has a recipe for success. Be sure to follow the recipe!

In my process, we dive into fears as they come up, we address them together. I help give you the space to discern a fear versus a real concern. It’s hard to do alone. Schedule a call here.

Here Are My Best 5 Tips To Fund a Franchise

When it comes to financing a franchise, you have various options—drawing assets from your retirement account, SBA loans, financing through the franchisor, home equity loans or second mortgages, borrowing from family or friends, or utilizing your own resources. If you decide to take out a loan or seek outside finance, there are several actions you may take to improve your chances of success.

When selecting how to finance your franchise, consider the following points:

Find out how much financing will cost in total. This covers interest rates, financing fees, the first six months of operational costs, and other elements.
Determine what personal assets you are willing to put at risk as collateral.
Make sure you understand the default terms and conditions for the financing alternatives you're considering.
Understand how the total and monthly payback expenses affect your present and anticipated cash flow.
Understand the debt's amortization plan, including how long you will have to pay it back and how your monthly payments or interest rates will fluctuate over time.

To become the ideal borrower, you must concentrate on the five C's: capital, credit, capacity, character, and collateral. This equates to available funds for a down payment, a solid credit history, adequate cash flow to meet debt repayment, past expertise in the business in which your franchise operates, and personal property to guarantee your loan. While not possessing all of these will not exclude you from receiving finance, the more boxes you check for your prospective lender, the more likely you will acquire the necessary funds.

Whatever method you choose to fund your franchise, there are five things you can do to boost your chances of approval.

1. Know everything there is to know about the franchise you want to acquire. Do your homework and be prepared.

2. With your lawyer or accountant, go over the franchisor's Franchise Disclosure Document, or FDD. The FDD is a goldmine of knowledge and the most significant document you'll read during the discovery phase.

3. Develop a business plan. Always bear in mind that the business may not scale up as rapidly as you would want, which implies that your prospective revenue stream may take longer to build than you anticipated.

4. Improve your credit score. A strong credit score is one of numerous elements that will determine your interest rate, payment terms, and loan amount.

5. Prepare your collateral funds. Most will want a 10 to 20% down payment to demonstrate that you have a financial stake in the financial success of your potential franchise.

Are you interested in learning more about financing your franchise opportunity? Please schedule a call here.

I Often Hear These 5 Common Misconceptions About Franchising

Have you ever considered franchising but were put off by some of the stories you've heard? Let's look at and dispel some of the most frequent franchise falsehoods.

The Cost of Franchising Is Expensive
The startup expenses for running a business or a home-based franchise are inexpensive, decreasing the barrier to entry. Furthermore, utilizing the franchisor's infrastructure gives you access to corporate services like marketing specialists, business coaches, and on-staff consulting professionals. This reduces the need for high-wage paid employees.

The Corporate Office Is In Charge Of The Company
For the first 90 days after launch, the franchisor will provide you with particular guidelines and critical assistance to gain momentum. Following that, you will have total control over the size of your firm and how big or little you want it to be. Then, you and the franchisor will work together to develop a business strategy that meets the goals of both parties.

I Can't Be Creative If I Own A Franchise
The franchisor will provide the framework, and you will be free to run the remainder of the business as you see appropriate. You may utilize your imagination in management, hiring, and other areas. If you want to be more creative, you may do marketing and develop content or events to improve brand awareness. It also works the other way around. If you love dealing with data, you can work in operations.

You Will Be Successful
There is no guarantee of success when it comes to purchasing a franchise or starting your own business. In the United States, around 20% of small businesses survive through their first year. Even if the franchisor provides you with the necessary tools for success, you must still work hard and put them to use. If you work hard and follow the franchisor's advice, you will have a higher chance of success, but it is not a short road.

You Must Be An Expert In That Subject
When searching for the perfect franchisee, franchisors focus on soft skills like communication, leadership, and work ethic. Franchisors do not seek hard skills, and prior business ownership is not necessary. You will receive substantial assistance as well as the resources you require to succeed. Make sure you're excited about the franchise company approach. It will greatly simplify learning the procedure.

Are you interested in learning more about available franchises? Schedule a call here.

Or if you want to read about more franchising myths dispelled, read here.

Did You Know Entrepreneurs Should Prioritize Emotional Satisfaction?

When most people consider becoming a business owner and making the journey from employee to a franchisee, they do not consider emotional fulfillment. However, in reality, assessing emotional factors should play a key part in deciding whether to become an entrepreneur or remain in their current situation.

Of course, evaluating risk against return should be included in every evaluation. It should include income and cash flow estimates. It should involve a review of finance options, geographical choices, and various other objective factors that will lead to a final decision on becoming an entrepreneur. A methodical approach to each of these topics should guide you on the path of due diligence.

However, assuming that the objective requirements have been checked off your list, it should all come down to emotional fulfillment in the end. After all, we all have the right to happiness.

Many job opportunities might satisfy your emotional requirements, goals, and desires. Many, however, do not and cannot. As a result, a thorough assessment of emotional factors should entail examining various issues, with the ultimate objective of determining if a job can fulfill your needs or whether your own business is more likely to meet them.

Take Charge of Your Destiny

This specific factor's importance for a person is perhaps the single most significant thing to consider before deciding to go it alone. How essential is it that you have control over what you do and where you do it daily? How important is it to know that you have the last say on whether you stay or go at some point?

In addition to analyzing the practical items of becoming a franchisee, the following emotional factors should be considered:

Are you happy where you are?
Can you attain your objectives and dreams in your current situation?
Are you more likely to satisfy your demand for control over your results by starting your own business?
How essential are each of these factors to you?

Evaluate these items honestly and the other control concerns that are important to you. Then, decide which circumstance best fulfills your objectives. And think about how essential that is to you. Then it's time to move on to the next element for evaluation.

If you apply the 'I deserve to be happy' test to each factor and try to figure out which scenario is most likely to get you closer to your goal, you'll know which column to check. If you carry out this procedure systematically, combined with an examination of the objective criteria, you will gain clarity in your decision-making process.

This exercise should also be repeated these other emotional factors:

Financial independence
Day-to-day motivation
Building a valuable asset
Appreciation for efforts
Schedule flexibility and control
Free time for family and friends
Community respect
Achievement and recognition

The bottom line is that you must consider ROI, cash flow, the support system, the value of building a brand, the marketplace, and all other objective factors required to make an informed conclusion. However, you should also consider what you want out of your life and if owning a business can help you get there.

If you’d like more information on how entrepreneurs choose franchises, please schedule a call here.