For entrepreneurs today there are many franchise businesses to choose from. Selecting a franchise business may seem a difficult task from the vast number available. Researching every angle of an available franchise before signing any documents will make selecting a franchise business easier.
When selecting a franchise business there are a variety of costs involved in purchasing the business. The first important step is knowing how much money you are willing to initially invest in buying your franchise, and how much money you are able to invest as your franchise business grows. Initial franchise fees may be as low as tens of thousands of dollars or run as high as hundreds of thousands of dollars. Another expenses that should be considered is the cost to rent a pre-existing office, store, building or facility, or the costs involved in building a new structure. Other investments to consider in a new franchise business may include cost to equip the business, initial inventory, operating licenses, insurance, and promotion fees.
What type of business you are looking for is an important step in selecting a franchise business. The skills, training and education you already possess can be an asset if looking to select a franchise business in a field you are already familiar with. For example, lets say that you enjoy electronic cigarettes and vaping and go into those stores on a normal basis. A Ecig Franchise would be a great next step in your franchisee pursuits. businesses do require training, licensing or certifications for the business owner and employees. These businesses may include real estate agencies, auto repair, interior design, or tax preparation.
Having business goals already in mind when you are selecting a franchise will help in your search for the perfect business. Have a clear understanding of what industry and type of business you would like to work in. Know the environment you want your franchise business in. Also decide whether you want your franchise to be a sales oriented, or service type business.
When selecting a franchise business there are several ways to find businesses you are interested in. Visiting local franchise outlets that are open for business can give you a preview of how that business runs. Other places to help in selecting a franchise business are franchise expositions, franchise brokers, franchise handbooks.These handbooks can either be obtained online or at your local library.
When selecting a franchise business it is important to know that the franchisor is required by regulations to provide you with the Franchise Disclosure Document for the franchise business. This document gives the buyer information to help weigh the risks and benefits of owning that particular franchise. The document is required to include 23 specific items. These items must include information about the franchise, the franchise’s offices and about other franchise owners. The Franchise Disclosure Document is enforced by the Federal Trade Commission.
Determining the goals you have for your franchise business, what type of services you intend to offer, and knowing your investment ability are important steps in selecting a franchise business. These steps will ensure you invest in a franchise business that fits your needs, skill level and future goals for you and the business.
1. Federal Trade Commission. “A Consumer’s Guide to Buying a Franchise.”
2. Federal Trade Commission.
9 April 2016