Owning a franchise is a beginner’s foolproof guide to the world of business. You do not need to have a business background, nor the education to reap the rewards of a successful franchise business.
Learning how to start a franchise is easy, and depending on the niche, it is also extremely rewarding. In fact, the two-year franchise success is 8% higher than the independent business success rate.
Sure, the business was created by someone else. However, that means that a lot of the hard work is already done and you have proof that the business is a success.
The only problem is knowing how to start a franchise, and doing so in the niche that will best suit you and your passions.
Thankfully, we did that research for you. Keep on reading to learn how to start a franchise successfully and enjoy every step of the way.
What is A Franchise, Exactly?
A franchise is a business model in which the owners, known as franchisors, sell the rights to their name, business plan, and logo to third party retailers known as “franchisees”.
Another term for a franchise is a “turnkey” business, meaning that it basically has everything you already need and all you have to do is just turn the key and start selling.
Franchise businesses are the most popular business model, and you cannot drive for more than two minutes in any big city without noticing at least a few of them.
Some popular examples of franchise businesses are:
- Mcdonald’s
- 7-11
- UPS
- Certain gas stations
- H&R block
- Domino’s Pizza
- Jiffy Lube International
- Merry Maids
- Subway
- Adventure Kids Playcare
- Anytime Fitness
- World Gym
- Massage Envy
- Supercuts
Starting a franchise business doesn’t mean it has to be a restaurant, there are many different niches for successful franchises such as fitness outlets, children education centers, handyman and cleaning services, spas, and nail salons. It all comes down to what type of niche you want to invest in.
What Are the Benefits of Opening a Franchise?
There are numerous benefits to opening up a franchise business, from security to pricing, marketing, branding, and more.
Security
Opening up a franchise business means that you are jumping on board to an already-successful business plan. Since most businesses fail within the first 5 years, you know that this model is a tried and true success.
Cost
Opening up a new business from scratch can make a serious dent in your bank account. There are many hidden fees that you may not even be aware of at this point. With a franchise, there are no hidden costs, what you see is what you get.
Marketing and Branding
Since the success of your business is determined by your customers and cash flow, when you’re running your own business, your marketing skills must be excellent in order to keep afloat. The franchise marketing has already been done, so you know that you’re becoming part of an already successful business where you don’t need to spend a fortune trying to build a brand.
Know Your Interests
Before you invest in a franchise, you must do some deep digging within and know if this niche is something that you actually have an interest in. For example, if you really love food, but you are considering investing in a Jiffy-Lube franchise, you may want to think again.
By ensuring that you have passions or interests in the niche that you are investing in, you will be able to push through the hard times when the going gets tough.
Know Your Budget
Most franchise businesses will expect an up-front payment or “franchise fee” when signing the deal. They will also have financial requirements to prove that you are financially responsible to open up a location on their behalf.
Take a look at your finances and make sure you are investing in a franchise that stays within your price range.
Do Your Research
On the outside, the franchise may seem like the most perfect investment, however, with some further research, you may discover that it is not a good fit for you.
Most franchise businesses have success, however, there are some that are either very expensive to purchase, or have an extremely rigid structure.
Some franchises expect that you follow suit in every single detail of the company. This includes uniforms, the employees you hire, the ads you place, the energy of the store, the words you say, the exact recipes for the food, and so on.
If you crave a bit more freedom, look into a franchise that has more playing room for you to be creative.
Get Connected
Once you have discovered the right franchise for you, it is imperative that you start asking questions to other franchise owners. Most people who invest in a franchise are more than happy to help.
Ask them questions about any struggles they have, how it is dealing with the franchisor, ask if they are happy with their franchise, how lucrative it is, and how the company culture is.
Ask All the Questions
After you have connected with other Franchisees and received the information you wanted, the next step is to start asking questions with the franchisors themselves.
Do not be afraid to ask some real questions, as this is a business deal that will cost you a lot of money in the long run. Compile a list of questions and have a series of calls or video chats to ensure you are making the right decision and with secure franchise compliance.
Learn More About How to Start a Franchise
Starting a business from scratch has its benefits as well, but as a new entrepreneur, nothing compares to the ease and structure of starting a franchise that already has success.
Now that you know the foundation for how to start a franchise, there are so many more business skills that you will benefit from learning.
If you found this franchise article helpful, check out more business articles like this in our blog.
