A franchise is a great introduction to the world of entrepreneurship. It’s a safer way to introduce you to business ownership by giving you access to key models, brands, and support teams to ensure your success. Each year, franchises contribute more than $757 billion to the global economy, employing more than eight million people.
Like any business, a franchise has some do’s and don’ts to consider when getting your franchise off the ground. If you’ve been considering a franchise, this blog will help you understand some tips to help prepare you for success.
Tips for the First-Time Franchiser
Let’s start with the basic legalities around franchising. A franchise is a business in a box. It involves using tried and true practices within a business framework that has been proven successful. You buy into that model and open your own business under that brand name.
But you should do some reflection, just like you would when taking on any new business, about whether the franchise model is right for you. The benefits of franchise ownership are that you’re following a proven model to improve your chances of success. However, your creativity can feel constrained because there are ways to present and run your business that is required as part of the franchise model. Your business will have to feel and look like other franchises under this model. Be sure you are comfortable conforming to these rules before you decide if a franchise is the right move.
Along the same lines, consider what kind of independent research you’ll do to confirm your franchise acquisition. The franchise company will “sell” you on why their business is the right choice. We recommend supplementing their recommendations with both anecdotal and concrete evidence that the business is the right one for you. Look for franchises that allow you to speak with other franchise owners. Usually, you’ll get an extraordinary amount of candor in every conversation you’ll have. Consider the market demographics to determine if the need for the business makes it the right time to launch. Dig heavily into the documentation to ensure that the company’s financial strength is both real and impressive.
Also, understand the realities of the money it will take that first year to get things going. You’ll have franchise fees and start-up costs from office rent and supplies to software. Look for any hidden costs, which, again, you should be able to double-check with the franchise owners that came before you. Find out how much realistically you’ll make that first year, given the realities of the current market environment.
Also, make sure you understand the laws of the land. Franchises are regulated under the requirements of the franchise ownership requirements but also by state and federal franchise laws. The good news for you is that the franchising company that you’re working under can walk you through many of these rules.
Franchise ownership can be incredibly lucrative. But what are your goals? How much time are you really ready to put in? Do you want just one location, or is the goal to expand?
Gecko Hospitality routinely helps those considering franchise ownership with these and other questions. Our hospitality staffing franchise ownership is the right business at the right time and can make a huge difference in your income potential and your pride of ownership. When you’re ready to launch something more than just a job, call on us.