Did you know that most Americans did not choose their career? Their career sort of chose them. (I’m sure that you don’t fall into that category). We are taught to go to school, get a job, pay your bills, be happy and shut up. Many people wake up around 40 or 50 years old and realize their job is stealing their soul. There is a low hum of frustration in that person's life because they know, deep down, that they should be doing something else with their life. At this point many people look at trying to change their path and take control over their career and life. Sometimes people turn to franchising because franchising allows someone to be a business owner almost immediately and control their day to day life and have freedom to make choices.
The issue is, we are not taught how to buy a business or what to looking for in a great franchise model. Many people buy into a franchise concept for the wrong reasons. Some people say to me that they want to get into the food business because, hey, everyone gotta eat, right? There's built-in demand. That may be true, however, how do you know if the food industry is right for you? Will it fit into your life style? And, if it does, how do you know which franchise company to pick? The nuances are endless.
My wife and I recently visited a franchised smoothie shop. The drink was exceptional. The service and the atmosphere was above average. I had a conversation with the owner of the shop. She talked about how the rent was radically low - and it was. I asked her why they choose this particular franchise? Without hesitation she said, oh, we LOVE smoothies! When we exited the beautiful shop, I turned to my wife and said, they will be out of business in a year. I was wrong, it was 9 months.
It doesn't matter how much you like a product or service, being on the other side of the counter is an entirely different experience. There are many mistakes that people make when choosing a franchise. They think they know the questions to ask to evaluate a business. The Road to Franchise Freedom_eBook, the e-Book I wrote with my friend, colleague and mentor, Matt Stevens, gives 21 questions or items to think about that most first-time buyers don't know to even consider.
As a franchise consultant who has owned and operated franchises and even failed in one, my job is to prepare my candidate for the education and discovery process, match them properly with fitting franchise options, coach them through the canyon between common perception (the customer perspective of a brand) and reality a franchise owner in a particular company. I do so honestly and objectively, so that they can progress in judging the merits of an opportunity’s suitability to their goals without my interference.
I make suggestions but my candidates make the decisions. When I look at franchise company picks, they must include:
In my professional opinion and experience, it’s a waste of time to discuss company “B" when company “A" operates a similar model but shows superior franchisee results and much higher success and profitability rates.
For the same reasons, if the candidate’s "Ownership Criteria" generally matches a specific industry, there's no reason to discuss every sub-standard concept within that industry. Instead we just investigate the best one in that industry that meet our eight criteria and is geographically available in the buyer’s backyard or as close to them as possible.
The franchises most likely to help you achieve your goals will have these eight things in common...
Top systems look for partners and build businesses with their franchisees, regardless of the system’s name recognition. Unfortunately, some of the most prolific names in franchising have high franchisee turnover and failure rates as well as poor relationships with their operators. Top systems earn their income from ongoing royalties that come from ongoing franchisee success, not from one-time hits via franchise fees.
The great thing about investigating a franchise as opposed to a business opportunity or even a private business that is for sale is, in a franchise, the eight criteria will be available for you to validate. Moreover, you have a wide variety of franchisees to interview from different walks of life, in various parts of the country, and with different professional backgrounds. When speaking with the existing franchisees of any franchised outfit, you’ll be able to ascertain the culture and whether you fit in. I can’t think of any other investment that allows you to do that type of evaluation or investigation.
For more on common mistakes made in a franchise review, download (no charge) my e-book, The Road to Franchise Freedom, today.