While buying a franchise may sound like a simple task compared to starting your own business, you would be surprised at the amount of time, research and hard work that goes into finding a franchise that fits all of your needs and desires. Many owners have found themselves in bad situations because they skimped on the research that went into investing in a franchise. Make sure that doesn’t happen to you by following these few simple steps.
1. Don’t Settle for the First –
While you may be one of the few lucky ones that dug up gold on the first try, there are a lot of franchise opportunities out there. Thoroughly research all opportunities in the industry you’re looking for before making any decisions. If in the end the first choice is the best choice, at least you can rest assured there was nothing better out there.
2. Check Out the UFOC –
The Uniform Franchise Offering Circular (UFOC) gives a detailed summary of the franchise you’re looking into buying, including any dirty secrets they may have been trying to hide such as lawsuits and bankruptcy details. It also contains a boatload of useful information that basically acts as a rundown sheet of what you’ll get with the franchise and what’s out of bounds.
3. Ask Questions –
Be prepared to ask the franchisers any and all questions you have. If you’re heavily debating between multiple companies, bring the UFOC for each company you’re considering and see what each one is able to offer you. Hit the Internet to find out more information, as well. Simple searches can shed light on the experiences other people had with the company, including their experience with buying into a franchise. Keep in mind that there will be positive and negative aspects of any business you research, but when it’s heavily skewed in a negative direction, think twice before paying.
4. Consider Location and Market –
You’re probably planning on opening your franchise close to home, or at least in the general vicinity. Look long and hard before deciding which franchise to go with when it comes to what the people are asking for. If your area is heavily saturated with pizza, reconsider opening a pizza delivery service. Instead, consider a steakhouse or ice cream shop. If you choose something that’s already been done a million times over in your area, you’re only creating competition for yourself.
When looking for the best franchise opportunities, don’t jump into something without thinking it through. Too many franchisees have found their businesses floundering because they made poor choices when getting set up. Also be careful not to let your passion blind you into making a bad business deal. You may have always dreamed of owning your own burger joint, but if there’s no market for it, your hard work will all be for nothing. When all else fails, find another franchisee and get their advice. They may be willing to put in a good word for you or steer you away from making the same mistakes they did.