Business options: Be a franchisee
Building a brand is essential for business success. One method to immediately identify your business is to become a franchisee.
The term “branding” began as a method of identifying livestock. While, “buying in” to an established brand or franchise may be expensive, it is balanced by the value that guidance, sourcing, business practices and name recognition offers. Entrepreneur Magazine regularly contains information on franchising with the May 2012 issue listing 17 franchise categories that have several successful examples. Also included are total franchise costs and the number of stores both independently and company owned.
Unfortunately, there’s no magic potion you can create to guarantee the franchise you buy will be a big hit. However, you can learn a few tricks of the trade and master the major elements that give a new franchise the strength it needs to thrive. Below are the tips from franchising insiders on the bare essentials for being a successful franchisee in this unique economic climate.
First, to make money you need to spend money, or at least have a little. While purse strings are tightening, franchisees still need to find the funds to maintain and grow their businesses. “They have to be funded. They can’t go into this on a shoestring; if they do, today’s economy will not allow them to succeed,” says Jerry Wilkerson, president and founder of Franchise Recruiters Ltd., a Chicago-based franchise executive search firm. “There are going to be peaks and valleys like we’ve never seen before. You can go for one week without any business and just get completely run over by customers the next. It’s that kind of economy and without the cash to operate, you’re not going to be able to continue your system,” he said.
Second, look for ways to tighten your purse strings in today’s economy. Read Recession Session from Entrepreneur, an online magazine for money tips and tech tactics. Franchisees with these means will not only weather tough economic times – they may even come away with stronger businesses. “They can survive recessions, creating more market share for themselves when the economy recovers,” Wilkerson said. “Many franchisees realize if they get into the market right now and really slug it out, when the economy starts to grind out of this recession, they will have a bigger market share and a better future.”
Due diligence before deciding to start a franchise on the part of the potential franchisee should include: visiting existing stores, attending trade shows, developing a business plan and examining their own people skills, risk capacity and resolve.