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Franchising Mistakes and how to avoid them
Written by: Ian MacleodArticle Overview: COMMON FRANCHISING MISTAKES AND HOW TO AVOID THEM Use this list to get ahead of the learning curve and avoid problems before they happen. Franchises have been around for a long time. If you are starting a new franchise business, you’ll often be confronted with problems and situations you’ll have to work very hard to solve. But don’t worry, you aren’t reinventing the wheel here. The kinds of problems you are most likely to encounter have been handled by people just like you, and you can learn from their mistakes. We’ve come up with this list of some of the most common franchising problems so you can avoid them before they happen.
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Franchising Mistakes and how to avoid them
COMMON FRANCHISING MISTAKES AND HOW TO AVOID THEM
Use this list to get ahead of the learning curve and avoid problems before they happen.
Franchises have been around for a long time. If you are starting a new franchise business, you’ll often be confronted with problems and situations you’ll have to work very hard to solve. But don’t worry, you aren’t reinventing the wheel here. The kinds of problems you are most likely to encounter have been handled by people just like you, and you can learn from their mistakes. We’ve come up with this list of some of the most common franchising problems so you can avoid them before they happen.
1. What did you do wrong? One of the simplest things you can do to avoid some of the most common franchising problems is to talk to other franchise owners, as well as the franchiser. Just ask them what they did wrong when they started, or what they wish they would have done differently. Though the specific situation they handled may not exactly apply to you, you can use their advice to learn to spot problems before they happen.
2. Know your franchise agreement? The devil is in the details, and one of the most important things you can do is to know your franchise agreement inside and out. What does the franchiser require of you? Do you have to buy specific equipment from a certain manufacturer, or can you purchase after-market goods? What about employee pay, or inventory suppliers? What can you personalize, and what are you specifically barred from doing? Knowing all this beforehand will go a long way in heading off disaster down the road.
3. Marketing pitfalls. A new business is a great opportunity, especially for those who want to sell you marketing. They’ll come to you and promise the moon, the stars and everything under the sun. Newspapers, radio, periodicals, TV and internet advertisers will want you to listen to them so they can get you the best exposure around. Be very careful here. Your franchiser probably has a standardized marketing plan already laid out for you, and you would be wise to follow it. Remember, companies that want you to advertise with them do so because that is how they make money. You want to be sure your advertising dollar is well spent, and following the advice of the franchiser is almost always the best way yo go.
4. Rental Space. When you start a new business it takes time to grow it into a successful endeavor, and anything you can do to minimize your expenses goes a long way. One of the simplest ways to do this is to get the best lease possible. Getting your new landlord to give you the first few months free, getting the rent as low as possible and ensuring maintenance fees and taxes don’t overwhelm you are some of the best things you can do to get going. Worrying about having enough cash flow to cover the costs of the lease is no way to focus on growing your business, so do everything you can to minimize these costs.
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Article Tags: devil is in the details, disaster, everything under the sun, franchise agreement, franchise business, franchise owners, franchiser, franchises, important things, internet advertisers, learning curve, long time, new business, periodicals, pitfalls, simplest things, specific equipment, standardi, sun newspapers, wheel
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About the Author: Ian Macleod RSS for Ian's articles - Visit Ian's website  We have a range of sites dealing with business and personal information. Here are just a couple... sellingbusiness for information on buying and selling a business financialagreements.com.au for prenups,postnups,separation,de facto, property settlement information etc Click here to visit Ian's website   Retail Tenancy Laws Australia Queensland QLD Retail Lease Shop Lease Franchise Agreements The Basics Retail Tenancy Agreements in Australia Is Buying into a Franchise right for you Communication Negotiation and Bargaining in Business |
Related Forum Posts
What to avoid when cold calling?
- Cold calling is the nemesis of all sales people. What words to avoid, what not to do when cold calling?
I will start first: avoid the word "maybe".
When you're cold calling, your best chance of success is to be self assured, confident, and 100% well versed in what you are selling. If you're using the word 'maybe' in your sales scripts, you run the risk of sounding wishy washy. It either is or isn't. Pick one.
Another word: "hope"
When you tell your client you're 'hoping' for something, you're not sure, are you? If you're not sure, then why should they be? Never let a prospect hear that you're not 100% behind your product, your company or your service, or it's entirely likely you will lose the sale.
So, what other words should we avoid?
Re: Re Franchise etc
- [quote="bmueller47":e0j0nu4t]Can you see a shift of various types of franchises? What I am thinking about is that today it is more difficult to create franchises, that has great appeal. More and more people want to have their business, but no interference of someone else.[/quote:e0j0nu4t]
Not sure what you mean exactly but it is certain that more and more people want to have their own business but not more and more people know what they really want to do, or how to do it. And that's what franchising is all about. Franchising is not for an entrepreneur. An entrepreneur will do his own thing. People who buy franchises want a turn key business, with a proven model. Franchising in the US had never been that good. I don't have the exact numbers in mind but I know for sure that franchising is growing more and more as people are getting more and more aware of this business model.
Franchising vs. Licensing?
- What is your opinion on Franchising vs. Licensing? Which is better?
Nominations for a new Franchising Moderator!
- Is there anyone you'd like to nominate as our Franchising Moderator (or volunteers for the position)?
Great Article, chock full of info.
- Ian,
Thank you for linking your article regarding Licensing vs Franchising.
Its a good read.
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