What makes a franchise such an exciting business opportunity is the fact that it is a ready-made business.The product or service has been hammered out, an interest for that product or service within the marketplace has been determined, and the brand that you’re going to be working with has an already established identity. In terms building a business, a lot of the difficult work has already been done for you.
But it’s a mistake to think of this and then say to yourself that a franchise is a plug-and-play business opportunity. While a great deal of the business heavy-lifting has been done for you, there’s still a lot that you’re going to be responsible for. And, at the end of the day, you’re still going to be running your own business, with all of any business’ attendant responsibilities.
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For this reason, if you’re considering purchasing a franchise or already own one, you should have a clear sense of what it’s going to take for you to be successful. While generally good business sense will serve you well in the franchise environment, it’s important to understand that franchises are in many ways their own thing. Because of this, you’ll find that there are responsibilities and potential pitfalls that you might not find with another opportunity.
Make Sure that the Franchise Business Model Is Viable
Before you sign the papers, take the time to research the franchise’s business model, and decide for yourself whether or not it’s going to be viable in the marketplace you’ll be operating in. Does the town really need another fast-food joint? Does the location at which you’ll be setting up shop have adequate road traffic around it? Is the market already saturated with other identical franchises, limiting your potential to grow your business outward by opening other franchises nearby? These are all things that you’ll want to seriously ask yourself and know the answers to.
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Keep Your Eye on the Prize
The flipside of the benefits entailed by a franchise being a ready-made business is that much of the exciting business work (marketing, advertising, product development) is not left to you. Because of this, entrepreneurs who are not prepared can find the process of operating a franchise to be drudgery. Don’t be that person! Instead, remember why you got into the franchise in the first place: to make more money and to expand your business. As you go about all of the menial business work of operating your franchise, remind yourself that all of your hard work is in service of a grander goal!
The Customer Is Always Right: Be a People Person
If you’re opening a franchise, then with 99.9% certainty you’re going to have to be prepared to interact with the general public. Depending upon your career and business background, this can be quite intimidating. But, don’t let it get the better of you. Remind yourself that your franchise is in the business of serving its customers to the best of its ability, and that you, as the owner of that franchise, are the business’ face in the local community. Sparing that, try to think of customer interaction as a form of networking; after all there’s no telling who might walk through your doors. If dealing with customers seems like a chore to you, though, then a franchise might not be right for you.
Take an Active Role in Day-to-Day Operations
One mistake that can befall the would-be franchise owner is in believing that a franchised business is a set it and forget it kind of business. Avoid this mistake at all costs. Just like you’ll need to tend to the customers that walk through your door, you’ll need to tend to the business that you’ve purchased and the people that you employ. As such, make sure that you create a positive atmosphere around your business, one that keeps your employees happy and keeps your customers coming back for more. Letting your franchise run without your direct involvement and supervision is a surefire way to lose all of the hard-earned money that you’ve invested.
Keep It Together
Last but certainly not least, make sure that you’re approaching the business with an attitude that’s as cool as a cucumber. Franchising can be a hectic business, with odd hours, demanding customers, various employees and more. If you’re not able to keep your head glued onto your shoulders, then you might find yourself hitting the self-destruct button on your business without even realizing it. To this end, make sure that when you set up your franchise that you come in with eyes wide open. Know what your tolerance for risk is, and make sure you have an exit strategy if things become personally unmanageable.