Think About a Franchise Before You Invest!
I have been in meetings the past several weeks where franchise businesses have been discussed. Interestingly enough, many franchise owners do not seem to do the required amount of due diligence work BEFORE they commit to becoming a franchise owner. In two cases that I have reviewed, the franchise owner did not seem to have the specific industry knowledge before they spent their money and became a franchise owner.
Now, I am aware that one of the benefits of owning a franchise is that you do not need to have any industry knowledge– the franchise will help you learn everything about what it is that you will do with your new business. If I was going to become a franchise plumbing company, I think that I would want to know at least something about hand tools, plumbing techniques, etc. Perhaps I need to know SOMETHING, maybe not a lot, but at least something. In the instances that I am familiar with, that does not seem to the be case— the owners received some franchise training, but after training, were kind of left on their own to figure out day to day management and operations.
A franchise business is a wonderful way in which to become a business owner. The right franchise provides outstanding training, national and international marketing support, a suite of tools with which to do the task and a procedures manual to handle any task that the franchise claims they can do. However, there are many franchises that provide, little, if any training, “back office support” marketing material or support. You pay a fee and “fly on your own.”
If you think that owning a franchise is something that you want to pursue, it may be very instructive to spend a hour or two with a business consultant and explore many of the factors that are associated with owning a business. The small two hour fee of the consultant will address a variety of factors that you may not have carefully considered– at least at this point. Even if you pay the 2 hour consultant fee, you will be money ahead in due diligence research if you elect to pursue some franchise opportunity.
We cannot overemphasize the value of strong due diligence before you do anything– let alone become a franchise owner. If you follow the franchise handbook and procedures manual, you should become a very successful business. Knowing what support is available from the franchiser is very important. Go slow, be careful and ask lots of questions before you spring into action in becoming a franchise owner.