5 Things To Consider Before Purchasing A Franchise

Buying into a franchise can be a great way to become a business owner. As a franchisee, you will be going into business with tried and tested processes and procedures, existing brand recognition and reputation, as well as the support of a head office and other franchise owners. If you’re considering becoming a franchise owner, Business Foundations have compiled a list of things to consider before taking the plunge.

1. Are you passionate about the franchise?

As a business owner there are times where you will need to step in and cover for employees and work on the floor. If you start a business from scratch, chances are that you are passionate about your idea and won’t mind doing this, but if you start a franchise you’re not interested in, you may grow to resent it. It is important that you can visualize yourself enjoying the day-to-day work in the business, as well as the management work, before purchasing a franchise.

2. Determine what support will be available to you.

Depending on the size of the franchise you are buying into, different support will be available to you as a franchisee. If you buy into a large franchise network, such as a fast-food chain, you will have the support of a head office and many other franchisee peers. If you buy into a small, localized franchise, you may find that your only support is in the individual franchisor. Before buying a franchise, work out what kind of help you might need and if you are comfortable with the existing support available.

3. Will your franchise be profitable?

It is not enough to assume that because a franchise is has an established business model that it will make a profit. You will need to crunch the numbers carefully to determine whether the specific franchise you want to run will make enough of a profit to financially support you.

4. What training will be provided to you?

Owning a franchise means that you have to follow processes and procedures set out by the franchisor. It is important to research what training will be available to you if you become a franchisee, and if it is sufficient to get you started. You will want to be looking for training that has both practical and theoretical elements covering management and technical training.

5. Are you ready to be a business owner?

Becoming a business owner is a difficult, yet rewarding career pathway. Whilst becoming a franchisee can provide you with additional support, you will still have many challenges as a business owner. Reflect on what you want your lifestyle to be and if becoming a business owner is right for you before buying into a franchise.

If you are considering buying a franchise, book an appointment with one of our business advisors who can help you look at the financial and legal risks and implications involved. Our advisors have supported several businesses through the process that have gone on to have successful and rewarding franchises.