Tweet

The Franchise Ambush, Part II - How to Help Your Friends & Family Help You.

Written by: Rick Bisio

Article Overview: This article dicusses the type of advice potential business owners normally receive from friends and family and provides a more balanced outlook on how to discover the best business opportunity for you.

The Franchise Ambush, Part II - How to Help Your Friends & Family Help You.

You’re in the market to buy a franchise, and you’ve found a concept that you like. You’ve read the website, reviewed the marketing materials and examined the Franchise Disclosure Document. In addition, you’ve talked to the franchisor a number of times. While your spouse may not be completely on board, you’ve kept him or her in the loop. It’s looking pretty good so far.

Advice that Helps
If you are serious about being a franchise owner, the next step would be to seek advice from business professionals who have practical experience in franchising, in the industry that you are considering and better yet, in the franchise you are considering. The franchisees are a wonderful resource and in most franchise systems they are open and willing to help. An accountant that has experience in this industry and knows the norms regarding profit would be very helpful. A franchise consultant that has years of experience in franchising can provide you with a balanced point of view regarding the opportunity. Finally, a lawyer that specializes in franchising can be helpful in reviewing the structure of the relationship.

Advice that Disorients
Far too often, potential franchisees get so excited about the idea of being a business owner that before they fully understand the risks and rewards, they start reciting their loosely formed dreams to anyone who will listen. They discuss their business idea with their drinking buddies and even with Great Aunt Edna. Now let’s be honest, Great Aunt Edna loves you but she’s been out of the working world for 25 years – she does not have an email address and still enjoys watching reruns of Bonanza. There is very little she can do to help you as you seek out more franchise information. There is a lot, however, that she can do to disorient you. Be careful.

How about your buddy who works for the U. S. Postal Service? His lifetime has been spent avoiding risk, maximizing salary, building his pension and surviving until retirement. There’s nothing wrong with that, but is he able to offer you much guidance? Probably not.

Many people have your best interests in mind. But well-meaning advice from people who simply don’t understand business ownership, the industry you are looking at or have practical franchise information can be incredibly disorienting.

Advice that Matters
Spouses generally balance each other in temperament. If you are a go-getter, there’s a high probability that your spouse is more conservative. S/he will remind you that the paycheck is nice, and will worry about what will happen if you fail. These are critical conversations to have. But you want to be prepared.

First, get all the facts and make sure you have a clear idea of what it takes to be successful in the business. How long does it normally take to break even and what level of income would a successful business create. Learn everything you can and involve your spouse every step of the way. If you spouse has a concern, listen to the concern and get as much information on the topic as you can to share with your spouse. These decisions are normally made as a partnership. If you and your spouse decide not to move forward with a business opportunity that you love, won’t you feel better knowing you’ve given him or her all the facts? At least then you know you gave it your best shot.

Here are some of the most common objections you are likely to hear, as well as some facts to combat those perceptions.

1. Don’t most small businesses fail?
Many long-term studies have shown that, unlike independent start-ups, franchises have a strong success rate. Owning a franchise (vs. starting an independent business) gives you a tremendous head start, including:
• A proven operating system that can predictably create success.
• National marketing programs
• Group buying power
• Training and on-going support
• Manuals, procedures, job descriptions, accounting help, and so much more.
To get more information on this topic go to the Download section of educatedfranchisee.com. There are several reputable studies that will give you all the franchise information you need in regard to success rates.
2. Why don’t you just change jobs?
Any book you read on wealth creation will tell you that very few people get wealthy by working for other people. Wealth is normally created in three ways – the Stock Market (less than 10% of millionaires created their wealth by investing in the stock market), Real Estate Investment ( 10 – 20% of millionaires created their wealth by investing in real estate), and Business Ownership (70 – 80 % of millionaires created their wealth by building businesses).

Getting another job will not move you to the next level. If you are looking to create wealth and a better future for you and your family, business ownership is the best path. Chapter 5 of The Educated Franchisee can help you learn more about how business ownership leads to wealth creation.

3. Maybe you should think about it some more.
You should not make a decision of this magnitude in haste but you do not want to delay either. Do your homework, ask all the questions and take notes – then make a yes or no decision in a timely and businesslike fashion. One characteristic of successful business people is their ability to make good business decisions with incomplete information. If you find yourself paralyzed, be careful, business ownership may not be for you. Yes or no, the most important thing is your ability and willingness to make a decisive decision and move forward.

4. What if you fail?
You need to move into business ownership with the knowledge that you may fail. Of course you may also lose your job. There are no guarantees with anything that we do in life. Nobody can guarantee success. All you can do is stack the deck in your favor.

If you know that most franchisees in your chosen system are happy with their success; that you have similar skill set to successful franchisees; that you are adequately capitalized; that you believe in and can follow the franchisor’s system; and that you are willing to work hard, you are on your way to being confident that you can succeed.

Before you begin to share franchise information with your friends and family make sure you have the facts straight. Educate them. Help them join your team. And if they can’t be on your team, maybe that’s OK. Everyone likes to give advice, and naturally, everyone gives advice from their point of view – their reference base. As long as you know that, you can appreciate their concern, and not let it overly influence you.

Related Articles
  Taking A Closer Look
  Making the Most of Your Franchise
  What is the best Franchise?
  The Accidental Ambush Part I
  Questions to Ask Before Buying a Franchise

Article Tags: aunt edna, bonanza, business idea, business owner, business professionals, disclosure document, drinking buddies, franchise consultant, franchise disclosure, franchise information, franchise owner, franchise systems, franchisees, franchisor, marketing materials, maximizing salary, practical experience, relationship advice, reruns, u s postal service



Related Forum Posts
Youth: What's u'r Financial edu? - I didn't grow up in North America so I'm wondering what sort of financial education is present in Schools? Where do you turn for such education? Do you go to your..Family? ..Friends? To the Youth entrepreneurs: What was the situation that made you think "I should be working for myself and start a business?"
Re: Enticing Franchises - Top 9 List - All Franchise listed above are in millions of dollars. Do you have the list of Franchise in thousands
Re: Info for would be franchisers... - [quote="Sebastien":1d29sdv1]Like Franchise Times, Franchise Update is a very practical magazine. There is no blah blah, just straight facts that anyone in the franchise community can relate to. I just want to mention that all these magazines are NOT franchisee oriented. I mean these magazines are for franchise professionals. If you're looking to buy a franchise, you won't find much information in there. To answer your question, getting published in Franchise Times was fairly easy. I don't want to brag too much but I think I am known in the franchise industry. I was the marketing guy at Franchise.com for a few years before joining my new company, the World Franchising Network. So people know me and I have a very good relationship with Nancy Weingartner, the Managing Editor at Franchise Times. I was talking with her at the last Franchise Expo South in Miami and she mentioned she'd like me to be profiled. I was like "ok, sure!". I like this franchise executive profile thing in Franchise Times as it is rarely BS. People are usually really natural in there.[/quote:1d29sdv1] Thanks for the follow up Sebastien! And I can't say that I'm surprised that networking with the right people and managing your relationships with them properly are the keys to being published. I guess the old adage holds true of "it's not who you know, but who knows you" that's important.
Re: I thought social sites were a waste of time. How wrong I was - Social Media has only really been understood this last year or two. Before that I didn’t really understand or like Facebook for example because of the problems separating Family and Friends from Business. Twitter seemed a total waste of my time and a lot of people seemed to spend all their time building up their followers to brag about how many they have got. Now I understand the basics a bit more I can appreciate the value particularly of Twitter in building up relationships with others in your niche with a view to doing business later. If people follow me and are active in the general Internet world or marketing in particularly then I follow back immediately otherwise I don’t see the point. You could argue I suppose that someone who breeds dogs and enjoys painting for example might suddenly become an Internet Marketer and I am missing out on not following them but I tend to stick within my niche. regards, Mal.
how much for a franchise fee? - Dear Colleague There is no easy answer to this question. Things to consider: [list=] The sizeof the Franchise Clent base Expected Turnover Intellectual Property costs (recoup) Number of Franchises Number of employees Original Set up costs Franchise admin costs An example: A franchise that I was involved in setting was to a simple "lawn mowing/home repair" franchise. The Franchise included national/local advertising - preparation of client lists - general admin - central accounting etc The Franchise involved 300-500 clients - and an annual turnover of about $300,000 . The annual franchise fee was $30,000. Hope that this gives you some idea Take care Ian[/list]


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Online Business Ideas: A Look At Various Options

Do You Pretend To Listen To People?

How to Develop Your Powers of Thought.

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.