10 Questions To Ask When Choosing a Franchise

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1 10 Questions To Ask When Choosing a Franchise You want to do something for yourself but with business support, and have decided that a franchise is the right option for you. But where do you start to look? Answer the following questions and find out. The first few questions are practical questions about you then it s all about choosing the right franchise! How much money do I have to invest? You will need finance to not only buy the franchise, but also to launch it and working capital whilst your business gets off the ground. There is a huge range of franchises available at a huge range of investment. Some franchises require additional investment in premises or vehicles too. Be clear what you can afford before you fall in love with something! Some of the major banks have specialist franchise departments who may loan you 50-70% of your initial investment. A good franchisor will already have relationships with at least one or two of these banks and will be able to make that first contact for you. Do I have any constraints or commitments? Buying a franchise requires a commitment you are launching a business. Before you choose a franchise you need to decide just how much you are prepared to put into it in terms of your time and energy. Answering the following questions will help you decide: o How many hours per week do you want to spend on your business? o How far are you prepared to travel in a day? Can you drive? o Do you have young children or other dependents that you care for? What time constraints do they put on you? o Are you prepared to work evenings or weekends? o Do you have any other financial or personal commitments? o Do you want your office base to be at home, in a van or in an office? o What inspires me and drives me? What would make you look forward to going to work every day? What would make you feel really proud? What is currently missing in your working life? What has happened recently to make you want to re-evaluate your working life? What gives you a buzz?

2 You will find it easy to become an expert in any area that you enjoy quite simply because it is a pleasure and a joy. If your business inspires and excites you, your enthusiasm is likely to inspire and excite your potential customers. Your work will become part of your life, rather than it being just a means to an end. What are my skills and what are my weaknesses? What are you good at doing? It s really important that you choose a franchise that you will be good at. Think about the skills you have developed in work, but also those you have developed outside too. Remember, you are making a fresh start and don t have to stay in the industry that you currently work in, but you should maximise your skills and expertise. Do you work best at a desk, or out and about? How good are you at customer-facing roles? Are you a good sales person, good with children or technically excellent at something? Being an expert and a specialist at what you do is essential to running any successful business - enjoyment and expertise naturally go hand-in-hand. Make a list of any skills you can utilise in your new business and note your weaknesses too. Remember that all reputable franchises offer excellent training packages and don t expect prior knowledge. For example, a swimming franchise will expect you to enjoy the water and to be able to swim but would not expect you to know how to teach or how to run a swimming business. How do I choose the right market sector? Keep all options open when considering a franchise. An open mind will ensure that you are far more likely to come across the right franchise that blends perfectly with you and your aspirations. With all the information about yourself that you have gathered so far, it s time to start looking for possible business opportunities. Here are some places to look: o Search the internet. This is a vast resource and there are several different ways that you can use it. Use keywords that define your area of interest as defined in the earlier questions (such as swimming classes, garden design, book-keeping) and follow the trail. Search the various franchise sites which have 1000s of different franchise opportunities, all categorised o Speak to trade associations for the operational view of the type of businesses you are interested in and ask their opinions about any franchises operating in the market o Listen to friends and colleagues and bounce ideas around o Speak to customers of the various business ideas you have

3 o Choosing the right sector(s) is critically important, so take your time and gradually a picture will start to emerge. You will know when something feels right. How do I know which is the best franchise in my chosen sector? Assuming you ve found several promising franchises in one or two market sectors, it s time to get in contact. Take a good look at all the websites and then send an or ring. You should expect to speak to someone in the business within a few days. Keep notes on your impressions and the contact you have. Have you been responded to in a timely fashion? Were they helpful? Was the information they sent you up to date, inspirational, professional and informative? It's best to select a franchisor with a well-known trademark to maximise your potential for success. Customers are usually prepared to pay a higher price for a recognised brand, and to receive a trusted product or service. Find out how the franchise business has grown. Will you have any neighbouring franchisees? How well supported are the existing franchisees? Look for and buy a franchise which has high integrity at the heart of its business. Has your franchisor taken part in any independent benchmarking surveys? Ask the question and ask to see the results. Taking part in a franchise satisfaction survey shows that the franchisor has a genuine desire to improve the service offered to the network, and since the results are purely driven by franchisee responses they give a good overall summary of what the franchisees think. Do you like the franchisors and the business values? Finding a good emotional and philosophical match with your chosen franchise is almost as important as choosing the right sort of business. If there is a good emotional fit between you and your franchisor you are likely to find it easy to follow the system and to work with the management team. Remember that business is all about people relationships matter! The best way to find out more about your potential franchisor is to go to Discovery Day where you can meet some of the management team and ask even more questions. Discovery Days should be inspiring and informative. When you leave, you ll have a good understanding of the franchise and both you and the franchisor are likely to have a good understanding of whether you will be a good fit for the network. Trust your instincts! Businesses are, and should be, constantly changing. You need to trust your franchisor and believe in the direction that they are taking the business. You need to be clear of your franchisor s vision, and be able to endorse it. Talk to some franchisees. Choose franchisees with a background like yours, ones at different stages of development, the very successful and the less successful ones. Are

4 they happy? Ask what they like and dislike and if they re happy with head office support. Hopefully you ve now found one (or maybe more) franchises that excite you and that you believe you can build your future with. Does the business have a good financial model? Successful businesses - not just franchises must be based on a sound and healthy business model. It is up to you to do your own research into your local market and make that business model your own. Location, disposable income, demographics, territory size, competition can all affect your projections. Your accountant, bank and existing franchisees can help to verify your findings and assumptions. Have the legal documents been written by a reputable franchise solicitor? Am I sure? It is important that you understand the Franchise Agreement between you and your franchisor before you sign it. Take the time to read it yourself and make a note of any questions. It should be a well-written document prepared by a solicitor who specialises in franchising. You should choose an independent franchise solicitor to review the Agreement and raise any questions. Your franchisor should answer all of your questions before you sign the agreement. Some details or documents might not be available until you sign on the dotted line, but your franchisor shouldn't intentionally withhold information that is relevant. Most franchise agreements favour the franchisor, of course, because this in turn favours the network as a whole of which you are part. However, you individual rights must be protected at the same time. Take your time and don t be rushed. This is a decision that will affect your life and those around you for at least the next 5-10 years. You ll be filled with a mixture of anticipation, excitement and anxiety this is a major decision and that s normal. But if you ve done your homework and followed these steps, you ll be fully prepared and can be comfortable with your decision. If you d like to find out more about owning a Puddle Ducks franchise, we d love to hear from you! Just us at

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