When you look at a franchise directory, it can be overwhelming. Even if you know the category of franchise you’d like to invest in, there can be dozens of options. What makes one franchise opportunity better than another?
In fact, it’s not that one brand is better than another, but more than one is better for your needs than the rest. It’s up to you to determine the criteria that will help you winnow down your options to one perfect match.
First, Look at Reputation
I’m assuming you don’t want to buy a franchise that has a bad rap. Lawsuits and lots of negative online reviews are a few red flags to watch out for. But also: pay attention to the word on the street. Do your friends shop at that franchise? Or do they steer clear of it due to some nasty rumor? It’s important to know what people think of a franchise, because “people” are your customers. If they think the brand is tarnished, you’ll find it hard to fight against that legacy.
On the other hand, a brand that people flock to is a good one to consider. When you think of the top businesses in an industry, does this one come to mind? Does the brand spend a lot on national advertising (something that will give you a leg up if you become a franchisee)?
Next, Decide What You Want to Invest
Realize that you’ll have more than just the franchise fee to cover just to open your doors: if you need to renovate commercial space, that can take quite a chunk out of your budget, as can equipment . And then there are payroll, employee benefits, and inventory to factor in.
So the question is: what’s your budget? Do you want to finance a few hundred thousand dollars, or would you rather find an affordable franchise under $25,000 to keep your costs down? The answers to these questions can help you eliminate any franchises that don’t fit your financial needs.
What About Franchisor Support?
Here’s one area where all franchises are not created equal, but it’s often hard to know how supportive a franchisor will be until after you’ve signed that franchise agreement. Your best bet it to talk to existing franchisees to find out how much help the franchisor provided in getting started and how readily available it is to answer questions now that the franchise is up and running.
The fact is: choosing a franchise should be a decision you find challenging. It’s a long-term, expensive endeavor, and you need to dedicate the appropriate amount of time to ensure that you choose the franchise brand that suits your goals and lifestyle needs. This will involve some research, so be ready to dig to get the answers you need to make your decision.