By Richard Newell
Franchising is a popular way for entrepreneurs to fast-forward their small business ownership ambitions. Franchisers provide a tested and proven base structure of the business, freeing their franchisees from having to start from scratch. The franchiser has developed and refined the concept, created a recognized brand, established supply channels, and formulated work processes. Often, they also know what markets are ripe for expansion, which is where franchisees come in.
There are already more than 828,000 franchised establishments in the U.S. according to the International FranchiseAssociation. They span nearly every type of business imaginable — from restaurants to fitness centers, from printing services to lawn care.
But franchising isn’t a guaranteed recipe for success. According to Jania Bailey, CEO of FranNet, a franchising consultant and resource organization, a franchise owner must have the necessary commitment and drive to make the franchisesuccessful. “A franchisee needs to have a well thought-out business plan with long- and shortterm goals,” Bailey says. “They need to pick the right franchise when they go into business, and be sure that franchise offers expansion opportunities. Also, they should pick a franchise that has a good track record of growth, and increased earnings at the franchisee level.”
The keys to be successful as a franchise owner are quite simple.
- Do your homework before you buy. Read carefully the Uniform Franchise Offering Circular, a disclosure document that every franchiser is required to provide prospective franchisees.
- Fall in love with what a franchise can do for you, not the product or service sold by the franchise.
- Be sure that you have developed your own personal business model and that the franchise you buy can help you achieve your personal goals.
- Be willing to follow the franchise system.
- Be willing to work hard and be committed to your success.
And as with any other type of business venture, prospective franchisees need a sound, well-crafted business plan to guide them on the path toward transforming the potential of these opportunities into positive results. To help prospective entrepreneurs explore and better understand the nature of franchising opportunities, FranNet and SCORE have teamed up to develop a variety of training tools, webinars, and resource documents.
Available for free at www.score.org, visitors will find information on the nature of the franchisor-franchisee relationship, guidance for evaluating franchising opportunities, legal and financing issues, and more.
Richard Newell, of Weaverville, is a SCORE volunteer mentor, licensed CPA and former franchise owner. To learn more about franshises and other small business matters, visit http://ashevillescore.org. SCORE — which originally stood for Service Corps of Retired Executives — is a nonprofit organization whose volunteers provide free, confidential business mentoring and training workshops to small business owners.