When you’re considering the different options for buying into a franchise, it can be quite challenging (not to mention time-consuming) to fully research the viability of each different brand. You want to ensure the brand is not only a good fit for you personally, but also has the capacity for growth and sustainability. Selecting a franchise system is not a decision to be taken lightly but knowing what to look for in a potential business prospect will help set you up for success.
To help you identify the right franchise system for you, look for these signs that signal a franchise brand’s health and sustainability.
Top signs that a franchise brand is successful and sustainable
First, it’s crucial to consider the brand’s potential for growth. Is the category already saturated? How much local competition is there? You’ll want to ensure you have the ability to stand out from the crowd and get noticed by potential customers.
Take a look at the number of franchise locations of not only the brand you’re considering but also its competitors. How rapidly are franchise locations opening? If the franchise is showing strong unit growth, it may be a good sign of potential success, but growing too rapidly could lead to over-saturation. On the other hand, if the brand has recently closed some locations, it may not be the best fit with growth in mind.
Consider also how far consumers are willing to drive to do business with you. This usually depends on how frequently they need your goods or services. It’s likely they’ll travel longer distances for higher-priced, less-frequent purchases like a vehicle, and shorter distances for regular purchases like fast food or groceries. Note the populated areas within your city, as you’ll want to maximize your proximity to potential customers.
As you’re researching franchise options, it’s a good idea to gauge an organization’s responsiveness. In addition to doing your research and reviewing as much information about the company as you can, contact someone from the organization directly to see how they respond.
Ensure the potential franchisor is straightforward in their response instead of avoiding questions or providing answers in a roundabout way. Also, factor in the response time. Timely and professional reaction to a potential franchise owner is a great sign that you’ve found the right system. If you don’t receive satisfactory responses in your initial stages of research, chances are that this will not improve once you become a franchise owner.
Another way to judge if a franchise system is the right choice is by their level of dedication to training new franchise owners. Ensure the brand’s training includes all relevant company-specific knowledge needed for daily operations, but also a general business foundation including finance, human resources and marketing.
At The UPS Store, new franchise owners or their designated managers are put through a comprehensive four-phase training program which includes in-store and university learning opportunities. The training curriculum covers store operations, technical systems, business acumen including human resources, marketing, sales and financial management, as well as print services training focused on equipment, software, techniques and in-center print production.
A good franchise system will not only provide a solid base of knowledge through their training program but will also prioritize ongoing support. Franchisors that establish a solid support system for owner questions, troubleshooting help or expert advice, show sustainability and higher potential for success.
Support is also available from other owners within a franchise network. If a new franchisee has a specific issue or question, more likely than not another owner has encountered a similar situation and could share their experience. For example, The UPS Store franchise owners can rely on a vast network of over 4,700 other U.S. locations for support, on top of a dedicated support team and regular opportunities to connect with other franchisees at meetings, conferences and the national convention.
One of the most telling insights into a franchise system is the satisfaction of its existing franchise owners. If owners are happy, that’s usually a signal of a good franchise system. Alternatively, when there is consistent negative feedback or sentiment from franchise owners, it may be a good idea to look for other options.
Take the time to research franchisee feedback before you decide to make the investment. In addition to online resources such as reviews, blogs, videos, testimonials, etc., speak with current and former franchisees to hear their insight and get a better feel for the business from someone with firsthand experience.
Finally, an important sign that a franchise brand is sustainable and offers opportunities for success is how well-known the brand name is. Established businesses have already put in significant effort to become a recognizable brand. This eases some of the burden on new franchise owners, allowing them to focus on operations instead of branding.
Part of the challenge of opening a new business is becoming visible to and trusted by consumers, so why not join the ranks with a brand that already has a trusted reputation? With nearly 40 years of experience, The UPS Store has become synonymous with shipping services, leveraging the globally recognized UPS® brand name.
While these aren’t the only signs of a successful franchise system, they are certainly important factors to be aware of when weighing your investment options. Owning a franchise can be very rewarding, but the company you choose must demonstrate sustainability. Make sure the franchisor you select shows at least these signs, and you’ll benefit from the existing strength and success of a trusted, established business.