Buying into a franchise is a great way to be part of a recognized brand with the benefit of lower advertising outlay. With many franchises to choose, here are some tips before you get involved with franchise:
Get The Support of Your Family:
The success of your franchise is also the acceptance of your immediate family in supporting your effort. It is this simple. Take for instance, if you buy a franchise which is part of a book-store chain and your family does not even visit it once. Will you have the determination to see it through? If you need to take a short vacation, will your family member help to run the franchise in your place?
Know Your Strengths & Expertise:
A franchise should not just be a means for you to start your first business. It is preferable that you have a recognized skill or interest in the franchise before parting with the franchise initial capital. Maybe take a personality test to determine if you have the tenacity to follow through with the franchise.
Unique Proposition Of The Franchise:
The franchise should be protected by a patent or intellectual property law. This will create a significant barriers to entry.
Market Research:
A franchise can be a huge success in a particular geographical region but has less acceptance in another country. Thus it is crucial that you inspect the relevance of the market research that has been conducted by the franchise company especially in the area of when the market research was conducted and the demographics of the sample set.
Franchise Competition:
Do not get a franchise that does not seem to have a recognized competitor or an industry that can be classified – unless you are interested in being a master franchiser or have a first-mover advantage. The market may be slow to accept your franchise and you may find it hard to re-coup your initial investment within the agreed contractual period.
Legal Assistance:
It definitely pays to get a legal expert to read the franchise contract fine-print. You do not want to be accused of violating some of the franchise terms of agreement and pay an unnecessary penalty.
Get New Contacts:
Do not just depend on the contact database that may be provided by the franchise owner. You should also try to generate new contacts as the franchise contact database may also be used by new franchisees.
Unique Ways Of Promotion:
Buying a franchise should not mean that you lose your competitiveness and innovativeness. You should find new ways of promoting your franchise through flyers, website and even various media. But remember to inform the franchise owner of your effort and get approval.
Joint Promotions:
You should also team-up with the franchise owner to joint promote in trade fairs and trade directories. You can also volunteer to start a dedicated franchise newsletter and be a regular article contributor. Your ideas may help improve the franchise.
About The Author
Colin Ong TS is the Managing Director of MR=MC Consulting (http://www.mrmc.com.sg) and Founder of the 12n Online Networking Community ( http://www.mrmc.com.sg/12n)
colin@mrmc.com.sg
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