10 Things You Should Know About Franchising
Are you seriously considering taking up a franchise business for sale offer? Then itís time you know what exactly is franchising and how to franchise properly. For your benefit, here are a few things that you are supposed to know about franchising.
10. Almost anything can be franchised in todayís world. There are innumerable types of franchise categories in the market and new concepts are being added almost everyday. So, the first and foremost thing you need to know is which franchise concept you want to join hands with.
9. Master franchise is a great way of starting a franchise, if you have the required money and experience. Though it costs more than a regular franchise operation, the profit margin is huge here. But, not every franchisor offering franchise business for sale brings in this facility.
8. Though itís true that no prior experience is required to buy a franchise, but most of the top franchises look for franchisees that have some experience in the areas of sales, marketing or management. So, itís quite necessary that you have some people skills in order to buy a franchise, especially from the best franchises in the business.
7. There are franchise concepts for every kind of pocket. But it doesnít mean that those that come in cheap are bad franchises. There are some low-cost franchises that are top franchises in their respective fields and yet, they are affordable.
6. The franchise fee is one of the fees that you pay to the franchisor when you are starting a franchise. Other fees like advertisement fees and royalty fee are also there that you are required to pay regularly as long as you are a franchisee.
5. Every franchisor offering franchise business for sale is obliged to give the UFOC to the prospective franchisees. The document gives a detail about the operation as well as the background of the company. It may or may not have an earning claim; but if provided, the franchisor has to back up his claim with solid proof of income from one of his franchise locations.
4. Top franchises in the business wonít allow any kind of change in the language of the franchise agreement, but some up-coming franchisor may be open to negotiation. In such scenario, your franchise attorney will play a big role in drafting an agreement, which will oversee your benefits.
3. Franchising means duplicating a proven system. So, you are required to follow certain guidelines and restrictions while you are starting a franchise. The franchisor has to maintain uniformity in all locations to save his brand name and image. Hence, there may be certain restrictions regarding what you can sell, how your interiors will look like and where you can open your location.
2. The franchisor is bound to support you in various ways and provide you with effective training on how to franchise the business. Hence, make sure your franchise agreement clearly states the support and training facilities of the franchisor.
1. Starting a franchise doesnít mean that you have guaranteed success. Itís true that franchise businesses are much more successful than stand-alone businesses, but itís also true that various factors will influence that success. For instance, your choice of franchisor and your dedication towards the business are some of them. The support system of the franchisor is also important, as is the market condition and the brand-name of the franchisor.
Have a question for Michael or want to leave a comment?