Buying a franchise isn’t just about picking a system that is profitable – it also involves making the right choice for you. Here are 6 signs you’re ready.
Investing in a franchise is a considerable personal and financial commitment. So how will you know if you’re ready to buy one?
1. You’ve talked to the experts
If you have taken the time to speak to a franchise accountant and lawyer about your ambitions, you’re on the right track. These professionals will be able gauge how suitable a franchise system would be for you in a legal and financial perspective.
Has your lawyer given the okay on the franchise agreement?
Is your accountant pleased with the numbers?
2. You’re family is onboard
On top of being a major financial decision, buying a franchise affects your loved ones too. Some franchises are run by families, for which advice should be taken in all cases. But even if you are not going into business with your sibling, spouse or even a parent, your family will be your support system when business is tough. So it’s important that your family is ready for you to buy a franchise.
3. You understand the typical term duration
Five years may not seem like a long time, but it can seem like forever if you make the wrong franchise choice. If you’re aware and comfortable with the fact that many franchise terms last for up to 10 years, then it’s a sign you are ready for the commitment. And make sure you have an exit strategy.
4. You’re looking to partner with a brand
By partnering with a brand, franchisees are expected to follow rules and systems as outlined by the franchisor. The franchisee/franchisor relationship is integral to the success of your business and the network as a whole. Be careful not to mistake franchising as a chance to buy a business and be an entrepreneur. Whilst some systems will allow franchisees to try new things, most require operators to follow a proven system.
5. You’ve done your homework
This isn’t your first rodeo. Perhaps you’ve had some experience running a business before, or you’ve done plenty of research educating yourself on the sector by consulting:
The sector’s peak body; the Franchise Council of Australia, business brokers, your State Small Business Commissioner, publications like Franchising magazine and Franchise Business online, attending franchising expos, and seeking online franchise education from Griffith University’s Asia-Pacific Centre for Franchising Excellence. If you’ve answered every question, you’re on the right track.
6. You’ve got a business plan
Last but not least, you have the drive and the plans to make your dreams come true. You have clear ideas about how you would go about structuring a business and how that model would operate. You are also ready to present your ideas to a business advisor.