Learn about these key points that will lead you to franchise ownership success.
As with any other business, new franchise owners take on some risks. Those risks can be mitigated to a degree by the franchise system the owner buys into, but risks and failures do still occur. If you’re interested in learning how to buy a franchise, here are a few tips to help you set your business up for success.
Choose the right business for you and your market.
An entrepreneur needs to ensure their skills are a good match for the business they intend to run. It can be difficult enough just learning how to start your own franchise, there’s no reason to compound that by getting into an unfamiliar industry. As a prospective franchise owner, you probably shouldn’t look to open a McDonald’s if you’re not familiar with food service, just as you probably shouldn’t look into a gym franchise if you’ve never even been to one!
You’ll want to keep in mind not only the primary product or service of the business but what running a franchise will require of you overall. If you like building relationships with people, a postal or printing franchise might be right for you. If you love a challenge and the restaurant industry, a table service franchise may be just the thing you’re looking for.
Keep in mind that your business needs to have consumers in your market. Avoid systems that have hit their saturation point in your area or that just aren’t a good fit overall. A new fast food restaurant where there are three others on the same block may not be a good idea, and neither is a giant hotel in a town of only 2,000 people.
Follow the system—it’s already proven successful.
You’re buying into a franchise because it’s a proven, reliable system. Use that system to your advantage by making the most of your initial training, reading the manuals that are offered to you, and leveraging every resource you need to.
Many franchisors, like The UPS Store, provide training, public relations support and more to guide and assist you. A few even offer financing options directly through the company so you aren’t faced with high interest rates through credit card companies or local banks. These resources benefit both the national business and you by setting you up to do as well as possible when you open your location. Make sure you check into what is available to you beyond just the initial cost or revenue projections.
Improve your general business skills.
Before finding out how to buy a franchise, make sure you’ve developed the skills necessary to succeed. No matter what franchise system you buy into, you’ll need to have some basic skills to manage the day-to-day needs of running a business. These include accounting basics, how to handle financial documents, general marketing and human resources skills. If you’re a bit rusty in any of these areas, you’ll want to check out classes or seminars either online or at your local college to increase your knowledge and get started on the right foot.
Learn your vertical.
In any field, knowledge is power. Arm yourself with as much relevant industry knowledge as possible, from the very beginning. What are common marketing returns in your industry? What is the average turnover rate for employees in your business? How long can you expect it to take for your business to start seeing profits? You should ask and answer all these questions as soon as possible. They’ll help to set realistic expectations for you and your investment.
Above all, understand that—especially in the beginning—a new business of any kind is going to take a lot of time, money and effort. Even a franchise. But, in the end, it can pay off and bring the returns you’re looking for.
Interested in learning more about how to buy a franchise? Contact The UPS Store today!