Starting a franchise is no easy task. But after you’ve got yours up and running, that’s when the real hard work of building your business — and staying in business — begins.
Thousands of new businesses start every year, but only 75 percent make it through their first year, and 55 percent fail within five. While the survival rate for franchises is higher than the rate for independent companies, staying in business is no sure thing. However, there are some surefire things that can cause a franchise to fail. Watch my video or read on to find out what they are.
A Lack Of Trust In The Franchise Investment And The Franchise Model
One of the main advantages of a franchise business is the fact that, unlike other types of companies, they come with a proven model already in place and a track record of success on which to build your own. Unfortunately, one of the main reasons why franchisees fail is because they fail to stick to the franchise model that they selected.
When you buy into a franchise like Bin There Dump That, you are making a significant investment. We advise new franchise operators to trust their franchise investment and follow the system. After all, if the system didn’t work, it wouldn’t be in business and you wouldn’t have chosen it in the first place.
Not Enough Funding To Fuel Growth
As the head of your own franchise, you will need to capitalize on any opportunity to grow your business. To make it happen, you’ll need as much capital as possible. Yet, many new franchise operators come into their systems without the financial means necessary to expand. This is due to the fact that first-time franchisees often approach fundraising as a one-time endeavor to cover franchise startup costs.
However, in order to ensure sustained success, you need to take a long-term view of your finances. Continually revise and update your franchise business plan in order to predict when you will be able to expand and how much capital you will need to fund that expansion. Leverage the business plan when speaking to different sources of funding for your franchise.
Choosing The Wrong Franchise
Even the most dedicated, well-funded franchisee can’t overcome the perils of a bad franchise system. That’s why, before you choose a franchise, you need to do your homework. Look out for common franchise red flags; avoid common mistakes for first-time franchise operators; and ask to speak to current franchise operators to gauge their feedback and opinions about the franchise system. Doing your due diligence will help you make the right choice — for your finances and for your future.
Prepare For Success, Not Failure
If you understand the value of sticking to a successful franchise model, and if you are poised to take advantage of every opportunity to grow, we invite you to do your homework on us. We are Bin There Dump That, a rapidly expanding leader in the $40 billion trash management industry.
Image: Closed sign