Choosing a Franchise

You are finally in the position that becoming a franchisee is a reality. You’ve been in communication with the banks and lenders, you’ve done a lot of research, and you know you’ll make the personal and professional commitment to make your franchise business a smashing success. However, there are some things you may not have considered just yet. Read on for everything you need to know to make sure the decision you make is best for you on every level.

Strike a Balance

To ensure your investment is a smart and savvy one, think about which franchise operation you’re joining. It probably shouldn’t be brand new, but also shouldn’t be overcrowded with fellow franchisees.

The Wall Street Journal explains it best:

“As a general rule, you will want to avoid industries and fields that are either too crowded or too thinly populated. Crowding creates competition, while the absence of franchisees in a particular niche suggests that it either doesn’t lend itself to franchising or that the market hasn’t yet developed adequately. Lenders prefer to fund franchises in proven markets, so keep that in mind as well.”

Finding the Right Fit

You’ll also need to do a little homework on yourself. Are you cut out to own a franchise? Small Biz Trends offers this line of thinking:

“A search for a franchise actually starts with you. Before you even think about vetting different companies and inquiring about opportunities, you need to conduct a self-assessment. Are you looking for an office-based, home-based, or retail-based business? Do you want consistent 9-to-5 hours, or are you flexible? How much time can you commit to the business? What sort of capital do you have available for an investment? How much can you borrow? The answers to questions like these will help you understand what sort of franchising opportunities you can realistically consider.”

Don’t Get “Sold”

There are few things worse than making an investment, only to find out it wasn’t a worthy one. To decrease the chances of that happening to you, take this advice from Business Town:

“Don’t get pulled in by a franchisor that is aggressively promoting itself and trying to lure you into an agreement before you have weighed all the factors and comparison-shopped alternatives. Once you have decided to seriously explore franchises, carefully assemble a list of prospective franchisees to evaluate in more detail. Come up with a list of core issues to compare. Then take your time getting and comparing vital information on each one. You do the shopping! Don’t let the franchisor do the selling!”