Deciding on the right franchise to buyFor many Australians, owning a franchise is a reliable path to business success. It’s not for everybody though, so the decision to enter a franchise needs to be approached carefully. To decide on the right franchise to buy you will need to check out numerous franchise for sale opportunities and take expert advice; your accountant, lawyer and banker should all be involved in the process of helping you choose the right franchise to buy, preferably from an early stage.
It is important to evaluate more than one opportunity in the industry or industries you may be interested in, by making contact with and comparing a number of systems and how successful they are. Ultimately only you can decide whether a franchise is right for you to buy.
Here are some points to consider on buying a franchise:- Your goals. How well does the franchise work for the lifestyle you want, and with what you want to achieve personally? Determine if the franchise is a good fit that will help you meet your goals.
- Your personal values and interests. How well does the franchise fit with these? Is it a business that you will enjoy operating day in day out for a number of years? A successful franchise also needs a substantial investment of enthusiasm, hard work and energy. Does this business allow you to use your skills and capture your interests?
- Search wide and many. Search out a number of franchise for Sale businesses to find out what best suits your needs and goals. Ask franchisors about their successes and failures and how it all works. Speak with some franchisees’ to find out how it has worked for them and about any issues they may have had, and about the franchisor’s reputation and the brand’s strength.
- Your budget. How much can you afford to pay? Keep in mind you will need some working capital, and some rainy day funds. Check with other franchise operators to determine the actual costs outside of the initial fees and purchase costs.
- The franchise rules. Most franchises operate under a very specific set of rules, and it is important that you fully understand and are comfortable with these before signing a Franchise Agreement. Understand exactly what is being offered and all costs. Also what happens when you wish to exit or if you were to under perform? Have a specialists check the agreement out.
- Your involvement. You may like to be “hands on” or just “manage things”. If you prefer to be working in the kitchen, greeting customers, or cutting the trees and don’t like managing lots of staff then you may be best suited to an owner/operator business. On the other hand if you like to manage people and resources and have a team about you, then maybe a Master Franchise of a managed styled franchise would better suit your needs.
- The level of skill involved in running the business. How do your capabilities match up with the skills required in the business? Most franchisors provide ongoing training and support for franchisees, but there will very likely be learning curves. You will need the desire to provide great customer service and be committed to doing a great job for it to work. Are you ready and willing to learn?
- Your ability to manage staff. Many businesses are built on the strength of having good people. You have to be able to employ and train good staff and keep them productive and happy. If you have never managed a team of people before, it can take some getting used to.
- The type of customers you will be dealing with. Are they the sort of people you will enjoy dealing with? Are you ready to meet and exceed their expectations?
- The operating hours. Some franchises involve long hours and operate seven-days-a-week, while some are on call. You will need the support of your partner and family to make the franchise work. How will you manage that holiday break, what happens when you get very busy?
- The physical demands of the business. Self-employment can be a challenge and many franchisees find that they need to be jacks-of-all-trades for at least some of the time. Are you ready to meet the many and varied demands that your business may make?
Consult with experts. Before you make your decision carefully review the business and the agreement, and enlist advisors to do the same. Then, step back and consider whether buying this franchise will provide everything you are looking for.
Australia is the most heavily franchised nation per capita in the world. There are a myriad of options to choose from. Always do your homework before you invest in any franchise or business. This material is for informational purposes only, always seek professional advice when evaluating franchise for sale opportunities.
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