During this week’s Proven Match blog, we’re going to look into franchise buying tips for 2017. There is plenty of information available if properly researched. Many of the advisory tips are self-explanatory, however, they often bear repeating due to their importance.
First, when shopping for the right franchise concept, are you truly comparing opportunities? The categories of consideration certainly lend themselves to direct assessment—even within a similar category. You may have locked on to a particular QSR concept because you like a component or two of their business model. But unless you check that opportunity against a similar competitor, you won’t have a full and complete picture to compare. Just be sure the examples are apples to apples, oranges to oranges.
Your instinct is a powerful persuader. Many a franchise candidate often decides to move forward with a concept because of a gut feeling or business intuition. Try to limit the background sales noise and be sure to consider what your own conscience is telling you.
Pay close attention to your territorial rights. If you are interested in a certain franchise concept, be sure that you aren’t encroaching on another’s area. Franchise opportunities should be extremely specific when spelling out exactly what your protected area of business will be.
Before buying a franchise, have a clear understanding of your own potential to secure financing and what your investment range can cover. You wouldn’t shop for a new house or new car without prequalifying your ability to secure the proper amount of funding. A franchise opportunity should be treated no differently.
Lastly, be clear on the level of support you can expect to receive from a new franchise corporate partner. The amount of support and training can vary quite a bit. One way to achieve a level of security is through the time-honored franchise tradition of validation. Which means, either get out on the field or get on the phone with the brand’s existing franchisees and be ready to ask as many questions as possible. Take copious notes and keep a discerning viewpoint with what you’re told.
In furtherance of this discussion, a popular industry publication, Franchise Business Review, recently released a key report, “2017 Top Franchises List: A Guide to Today’s Top Franchises.” This independent review takes a look at key factors in determining some of the hottest current franchise concepts, tips to consider before you begin a franchise search and even alternate funding options you may not have considered.
The report was generated through the participation of over 30,000 franchisees representing over 300 different franchise concepts. Each agreed to participate in the study for the benefit of the industry as a whole. One of the most surprising findings was that many franchisees don’t achieve personal satisfaction as a franchisee solely from the amount of money they can make or generate.
When interviewed, the CEO of Franchise Business Review spoke about the report and the importance of surveying:
“Franchises that survey their franchisees realize that transparency and openness contribute to a trusting relationship,” says Eric Stites, CEO of Franchise Business Review. “Franchisee satisfaction ratings show you whether or not a franchise opportunity is really as good as it appears and fits your values and vision by providing insight into a system’s culture, training, leadership, financial outlook, franchisee community and much more.”
If you have the extra time, review what the report has to say. You might learn another thing or two about advice before buying a franchise in 2017.
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As a franchisor, you’ll want to know which existing and potential franchisees best fit your business concept. Proven Match is the proven solution in determining those factors. Through our proven behavioral assessment techniques, predictive analysis becomes a predictive success for your franchise concept. If you’re ready to show your leadership by getting started, give us a call and we’ll put you on the path to a more productive year in 2017.