So you are thinking about becoming a franchisee? That’s great, but you can’t just call up a franchise group and open your business the next day.
On the contrary, starting a franchise takes time, preparation and effort — and that is especially true if you are looking to join a top franchise company. That’s because, good franchise systems are protective of their brands and reputations, and they look for serious candidates who can contribute to the success of the franchise as a whole.
How can you prove you’re serious about starting a franchise? By showcasing these signs:
Having Sufficient Capital
Like any business, a franchise requires money — to open it, to run it, and to sustain it. Franchisors will want to make sure that you have enough capital to cover initial and recurring costs associated with operating a franchise, and so they will look carefully at your personal and business-related financial situation and history.
In addition, many franchisors have minimum thresholds for net worth that you will need to meet. Net worth can include assets such as cash, real estate, savings, stocks, bonds, etc., so make sure to have your finances in the best shape possible before approaching a franchise. Lastly, while you can borrow money from a lender to make up some financial shortcomings, franchisors are wary of franchisees who start out heavily in debt.
The Right Reasons
What’s motivating you to start a franchise? Prospective franchisors will want to know what makes you excited about the opportunity and, more importantly, why you want to join their system in particular. Is it because you have related skills and experience from previous jobs, or because your personality seems to fit the culture of the company? Do you like the franchise model, or are you a former customer who is a big fan?
Whatever your reasons, you will want to clearly demonstrate them and make sure they align with what the franchise is looking for. Thus, you should narrow down your list of potential franchises early in the process and identify those that are a good match — for both parties.
While you can make a lot of money out of a franchise, you will have to put a lot of work into it. As a result, you’ll need to prove to franchisors that you are willing to put in the effort necessary and that you understand all of the responsibilities that will fall on your shoulders.
Once again, a good way to demonstrate your understanding is to do your research. Examine all of the information you can about a franchise — newspaper articles, blogs, website content, etc. — before engaging in a conversation with a franchise representative. You want to make sure you have the right perspective before engaging in a dialogue.
A Solid Understanding Of The Franchise Model
Of all the reasons to start a franchise over an independent business, perhaps the most advantageous is the fact that franchises offer a complete, well-defined and proven business model for you to follow. Unfortunately, not all franchisees commit to the system, which is one of the main reasons why franchises fail.
To lessen the likelihood of failure, franchisors will want to make sure that you understand the model and are willing to execute it. Thus, you should research each franchise’s website in detail and get an intricate understanding of the way the franchise works. You will also need to demonstrate that you are a team player by providing examples of times when you put your business first and your ego second.
Now that you know what signs you should signal to franchisors, we invite you to learn more about our franchise. Sign up here to receive our free franchise kit and learn why you should seriously consider becoming a Bin There Dump That franchise operator.