Franchise Flag Maker

The more I look into the Franchise Industry, the more it is apparent that most Information is geared around selling franchises. The Business Franchise is exactly that – big business.

If you do a search on Google on ‘franchise’ or ‘franchise information’ then you are likely to be presented with thousands of pages of franchise advertisers, franchise consultants, franchise marketplace websites and possible a franchise association.

I have been seriously researching the industry for a number of years now and the number of good information sources I have found are few and far between. There are a number of good books on Franchising on amazon and I strongly suggest that if you are seriously examining buying a franchise then you read as many as you can. You can never do enough research.

I have just come off the back of two days solid of research on google on franchises and I have yet to find any information sites that are not in some way ’sponsored’ or funded by franchises or consultants.

Why is this? Do you know any?

The franchise Industry is big business and the opportunities to get impartial, informative advice and information are few and far between.

If you are considering buying a franchise then the biggest piece of advice I can offer is to consider the motivation of any article, web site and ‘guru’ that you come across. Do your due diligence and ask what their motivation is for providing that information.

To begin that process, let me give my honest answer:

I am writing a blog to give impartial advice from some one who has been a franchisee. I have seen the good and the bad of the franchise industry and have lost a lot of money.

I have spent the last three years, and more, fully researching the franchise industry and have been struck by the lack of impartial advice and information. I have a small vested interest as I am writing a manual on my experiences and how you can avoid them and will be launching it soon. Apart from that, however, I have no other interest in providing you information other than making sure you make the right decision for the rest of your future.

Learning about the franchise industry from honest people can give you every chance of success when researching and buying a franchise. Using the Internet to it’s full potential as a tool for your research is a must and at the end of the day with the right knowledge in hand you can come away with a fantastic business for life which can support your and your family in the way that you want to live. Without doing the proper research it is likely you will buy into the wrong type of franchise for you or one which may well collapse in the near future, leaving a gaping hole in your pocket and with little no no resources left to set up fresh.

To your future business success.

If you are interested in buying a franchise business, it may behoove you to do so through a franchise broker. You should also consider utilizing the advice of a professional franchise consultant.

So, What Exactly is a Franchise Broker?

A franchise broker is simply someone who acts as a liaison between franchisors and franchisees. He gets the two parties together and has the sale of a franchise as his ultimate goal.

Empirebb compares a franchise, or business broker to a real estate broker because, essentially, a business broker does the same thing. The only difference is that instead of selling houses, the franchise broker is selling businesses. He assists the seller in preparing the business for sale and also prepares and delivers necessary documents. He will facilitate the closing of a deal and earn a commission on each sale.

The franchise broker’s knowledge of available business opportunities can greatly aid you in your own search.

Some Functions of Franchise Brokers

Empirebb provides this list of the various roles of a business broker:

* Listing businesses available for sale

* Assisting owners in the appraisal of their businesses

* Gathering and/or requesting all the relevant documents for the sale of the business

* Producing description sheets, which promote the businesses

* Promoting those franchises which he has listed

* Guiding/qualifying prospective franchisees

* Acting as an intermediary between franchisor and franchisee

* Setting up contacts for both parties with professionals such as lawyers and accountants who will be instrumental in completing the sale

* Assisting both franchisor and franchisee throughout the sales process

Well, What About a Franchise Consultant?

A franchise consultant provides professional advice to entrepreneurs interested in franchising. US FranchiseNews suggests a list of things you, as a potential franchisee, should expect from a professional franchise consultant.

This list includes matching you with a franchise that will best suit your individual needs based on finances and personality. The consultant should find, within your selected industry, a franchise with a “creditable track record.” You should be advised by the consultant of what a particular franchise agreement will expect of you, so you can make comparisons through your own research. A consultant should assist the prospective franchisee in acquiring all pertinent information about a franchise and explain how you can research the franchise on your own. Finally, the consultant should aid in the review of legal documents and help you understand various financing options.

And What are the Advantages of this?

You might ask what the advantage could be in paying for this type of advice. After all, you are capable of doing research on your own. Well, there are many benefits associated with the acquisition of professional knowledge.

Starting a franchise (or any business) is a monumental decision that requires many cogs to work together in one machine, and, frankly, seeking the advice of an expert in the field just makes good sense.

The use of a franchise consultant will also exponentially increase your chances of locating that one business opportunity that is just perfect for you. A professional consultant will be well-acquainted with the plethora of opportunities available. And, with business opportunities ranging from investment-only to part-time ventures to even multiple unit chains in industries ranging from fast-food to retail sales to tax preparation, the expertise of a franchise consultant could greatly reduce the time you must personally spend researching to find the best fit. It just means you’ll be opening the doors of your own business that much quicker.

All this being said, there are a few factors to consider when choosing a consultant or broker. First, a potential franchisee should bear in mind that other than factual information such as financial data or litigation history, all the advice provided by a professional will be subjective. This means that you should consider the philosophies of a franchise consultant and whether they coincide with your own.

For example, some consultants may believe that the product itself is the key to success, so a franchise that offers a product or service in high demand will be an automatic success; however, a different franchise consultant might truly feel that brand awareness is the best indicator of future success and so advise you to seek out a well-known franchise.

Therefore, as a prospective franchisee, you should evaluate your own philosophies about the keys to success in business, so you can make an advantageous selection when it comes time to choose a franchise broker or consultant.

This way, you assure yourself that your broker or consultant will be presenting you with business opportunities with a strong potential to be a good match for you.

And remember that success in franchising is measured by reaching your personal goals within your personal timeframe. It isn’t necessarily based exclusively on profits.

A good franchise broker or consultant will weigh all the elements of your personality, needs and unique desires in order to locate a business opportunity that will be rewarding to you in each of these areas and exhibit the best possible potential for allowing you to achieve your business goals.

Kids franchises have to be one of my favourite franchise opportunities on sale in the UK today. Quite simply they are all bright, fun, loud, in your face and in all cases I have seen, run and managed by caring and considerate franchisors.

Ranging from education franchises through to care, sports, music and arts there are a multitude of options to choose from.

Deciding on which one is for you can be difficult so really it’s a case of matching your own interests with your investment level to the corresponding franchises to narrow your list down some. Hopefully after doing this you will have at least 3 to ponder over. From here it is time to get a collection of franchise packs and begin your research.

With your 3 + packs in hand, review the procedures, training options and monthly management / license fees and weed out any which are immediately unattractive to you. What you should be left with are your prime choices and it is now time to contact the franchisor direct to organise a meeting.

Come prepared! Before you go write down a list of questions, some / all of the following should be included:

1. How long have you been in business / how long have you been franchising? Reason: You want to establish 2 things. 1, was the business a long term profitable company BEFORE they franchised or were they a “made to franchise” business and 2, Are they a new company starting out in franchising, if so then they may well be a little inexperienced.

2. How many current franchisees do you have and can I have a list of ALL their contact details. Reason: You can pick a few at random to phone and ask them about their experiences, the ups the downs etc.

3. How many franchisees HAVE you had… i.e.. What is the turnover rate of franchisees. Reason: A turnover rate shows an unhappy franchisee base.

4. Out of the current franchisee list, how many are profitable according to your financial projections? The reason for this is: Some franchisors boast a large franchisee base but this could be due to their selling powers and not the profitability of the franchise.

5. What is the policy on

a) Territory size

b) Exclusive territory

c) Reselling my franchise

6. What previous companies have they owned and were they franchised businesses too. The reason for asking this is: Are they in the habit of creating businesses to franchise, making some money and moving on leaving their franchisees in limbo. Yes, this happens.

7. What marketing campaigns are done on my behalf and what will I be required to do myself? Here you are looking to learn more and national advertising done by the franchisor and what systems they recommend for local advertising.

These are just a few questions and you will have many you will want to ask however I would recommend getting the answers to the above so you can feel sure that this is a long term opportunity for you. Franchises are not a cheap option by any means; however either is setting up a business from scratch. You are going to be spending anywhere from £8,000 to £250,000 of your hard earned cash or loans so you really want to be sure you are spending it in the right place.

All that said – I could not recommend more a sector of the franchise industry to get involved in that kids / children based franchises. Definitely a respectable, fun and profitable option