What are the best franchise opportunities?
Franchising has been around a long time in the UK. Investing in a franchise opportunity is a great way to enter self-employment as franchises generally have a much lower failure rate than independent start-up businesses. Franchising is also a great way to change career direction as when you invest in a franchise opportunity the business owner or Franchisor will usually provide extensive training & support. There are hundreds of franchise opportunities for sale including retail franchises, van based franchises & management franchises but what are the best franchise opportunities?
Firstly what are the best franchise opportunities for you?
Before we go onto areas such as selection of franchises & due diligence you need to consider which franchise is right for you. Just trying to short list franchises based on if you know or recognise the brand or claims of earnings potential is not enough, you need to consider what is right for you.
So what do I mean by right for you? Well as I have already touched on above it’s not about your career background to date because Franchisors will provide extensive training & support making franchising a great way to change career direction. What I am referring to is you need to consider if the franchise suits your character traits & beliefs. Let’s say you work for a company & are a great salesperson used to coming up with creative new ideas & the buzz of generating new business. If you select a franchise where all work is supplied & you just carry out a task you will probably get bored fast & will never last the term of the franchise agreement. On the other hand if you the sort of person that is great at planning, implementing & managing projects but do not thrive in a creative or sales environment then a franchise that involves sales, whether B2B or B2C will just not suit you or play to your strengths.
When selecting a short list of franchises first be honest with yourself & evaluate what sort of person you are & what is going to keep your interest & play to your strengths. Once you have done this before looking at financial & earnings potential you then need to seek franchises that you have a personal connection with. This could be something you believe in such as social care for example or could be something you enjoy doing as a hobby, say a sport, fitness etc.
If you are able to match your personal character traits & interests to franchise opportunities on your short list you are one step closer to finding your idea franchise opportunity.
How do you buy a franchise? What’s the process & what is due diligence?
So once you have selected your franchise opportunities based on the above & created your short list what’s next? Before you buy any business including a franchise you need to carry out thorough due diligence, so what does this involve?
- Meet the Franchisor – Once you have your short list the next step is to visit the Franchisor, preferably at their place of business. You need see the key members of staff, where the support is coming from & ask as many questions regarding the business, the support & how & who delivers this. Make notes including the names of key people & regarding support for future reference. Never sign anything on the day or be pressured into doing so!
- Speak with or meet existing Franchisee’s – If possible you want to speak to or meet existing Franchisee’s. Find out their experiences with the Franchisor regarding support, launch & if they are achieving the projected earnings potential.
- Background checks – If the Franchisor is a Limited Company which most are it’s easy to run a background check on the Directors & company via the Companies House website. You need to look at the company accounts to see if it’s profitable and/or has liquidity. You can also check out the company Directors. Do the Directors have other business interests now or in the past? You can also run the same background checks on the existing Franchisee’s if they are a Limited Company.
- Take professional advice, take professional advice, take professional advice! I have received hundreds of phone calls over the years from people that have signed a franchise agreement without even knowing what’s in the agreement! I know that sounds bizarre but you would be amazed how many people sign a 5 year franchise agreement without really understanding what their obligations are! When I have advised people to get a legal review many have said “I don’t want to spend £500-£600 on a legal review, I have read the agreement myself & I am happy with it!”. Always take professional advice before buying any business, including a franchise opportunity.
I hope this helps you find the ideal franchise opportunity for you. We are always here to assist you & have a free franchise guide & a free franchise matching service. In addition to these free downloads we are real people here to assist your franchise search so fee free to call one of our friendly team on 01323 332838.