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Part 2 – Should You Consider Franchise Ownership – Why or Why Not?

Lesson 29 Module 8

You should have studied the prior lesson on becoming a business owner in order to get a more balanced view on this topic about owning your own business. Do you have an entrepreneurial spirit? Does full-time, part-time or semi-absentee owner/investor better suite your needs?

Taking a Deeper Dive Into Your Top Franchise Ownership FAQ

Why Franchising?

You Get Control. Franchising allows you to go into business for yourself but not by yourself. Franchising allows you to take control and be directly rewarded for your hard work and efforts.

Lowest Risks with Maximum Support. For a majority of people, franchising has proven to be a viable way to become a business owner. For the most part it offers the lowest risks and the highest level of support.

Creates a Win-Win Partnership. Because a franchisor doesn’t succeed until the franchisees do, you’ll find a team of dedicated professionals willing and able to help you every step of the way, from site selection to employee hiring to grand opening. They will keep in touch with you from the very beginning to years down the road and they have web sites, toll free numbers and a dedicated staff to make sure all your questions are answered quickly. Research and development are possible because of feedback from those in the field and this cooperative involvement is a hallmark of a well-run franchise business.

Get a Proven System. The final benefit of franchising is that you buy a package – product or service, brand name and trademarks, marketing and advertising, operations manuals and proven systems – along with thorough training in every aspect of the business. You can totally change careers without years of schooling or apprenticeship or research. One day you can have a “job” as accountant or police officer and a few months later have a “career” as the successful owner of a business, which may be an auto detailer or a pet spa or a home improvement franchise.

And that’s why franchising succeeds – because it works, for the franchisor, for the franchisee and for the consumer.

What is a Franchise Consultant?

Get a Dedicated Advisor. A franchise consultant is someone who consults you through the twists and turns of the franchise world and teaches you how to work your way through it. Whether you are a franchisor or a franchisee, there is a benefit to using a franchise consultant.

Get Correct Answers to Critical Questions. Having a specific person to answer the big questions about franchising and being successful can do wonders for growth within a franchise. In addition, potential franchisees don’t necessarily know what they want, how to get there, and where to start. A franchise consultant can help with all of this and more. 

Find Your Best Match Among Thousands. A consultant can help you consider your interests and skills and determine what the best possible franchise matches could be considered or even if it is the right path for them to be a franchise owner. They help them every step of the way by matching them to the potential right fit, helping guide them how to conduct a proper due diligence.

No Fee for Service. Any good consultant should not charge a fee for their services due to the fact they are paid directly from the franchisor if they make a successful match based on a finder’s fee.

Are all franchises the Same?

Short Answer - No they are all not created equal! Our recommended Franchise Consultant has been a franchisor for over a decade.She says, "It's vitally important to conduct validation and speak with existing franchisees that bought the concept you evaluate for yourself, along with reviewing their Franchise Disclosure Document (FDD) to and read completely along with evaluating the personality of the franchise brand to make sure you are a fit. 

Investigate Before Committing. Remember it is meant to be a business marriage so courtship will be paramount. You certainly would not want to get into a business partnership with someone who truly doesn’t care about your success or doesn’t provide solid training and support. 

More Information Available. Let us know you're open to at least having a free 15 minute discussion with our recommended Franchise Consultant and she'll make available her digital reports on on How to Buy a Franchise, 10 Costly Mistakes to Avoid to help you know what to look for. And if you want to continue this discussion, she will help you navigate the process.

Is owning a franchise more expensive than starting your own business?

A System Already Proven Successful. When you buy a franchise, you are buying the rights to someone else’s proven business plan. The model, the uniqueness, the operations, the marketing, training, support and technology is all be figured out. 

Less Startup Time - Quicker Revenue. The value of time as a person to have to find all of this and put everything together when starting your own business is priceless. When you buy a franchise you are buying speed to market. This way, your time and your money go toward making the money instead of trying to figure out how you are going to make the money with your own vision. 

Break Even Time Reduced. Reality is, we can nearly cut in half the break even time with a franchise concept, simply because it is proven and you will simply execute in your desired geographic area. Ultimately franchises do not cost more than starting your own business because of time value and risk factors.

You can't be in business you know nothing about - right?

That is a Huge Myth! Often people believe they have to be the expert in whatever business they choose. With a franchise, you are partnering with the experts - the franchisor. Every business operates the same way and when you decide to become a franchise owner, the first decision you make is what role you want to play in the business.

Multiple Options Are Yours. Do you want to be the “expert” and not deal with any employees?

  1. Do you want to be the operating president where you build a team underneath you and build an asset you have grow and have a built in exit strategy for when you are ready to officially retire?
  2. Do you want to keep your day job, hire a General Manager who runs the business on a daily basis and you build additional wealth and income outside of your 9-5?

The True Reality. When you become a franchise owner, you elevate yourself from the employee - expert to the Executive - Operating President or CEO. Required transferable skill-sets from your past career will be leadership and management. Surprisingly most franchisors prefer an owner who is not an industry expert, but instead hires people who can the day to day work, giving the franchisee time to focus on growing and managing the business. You bring the entrepreneurial spirit and in exchange, they give you the training and support.

What are the dos and don'ts in conducting a franchise search?

  • Don’t rely on google, friends or family to tell you what business you should buy.
  • Don’t follow your passions, or make your hobby your business.
  • Don’t approach this as a shotgun aimed a moving target! This is an investment.
  • Do take into account your skill-sets and interests, along with your weaknesses.
  • Do your homework.
  • Determine how much you can reasonably afford.
  • Consider hiring a franchise attorney.
  • Decide where you want to go and determine how to get there.
  • Set a timetable for achievement.
  • Beware of friendly advice from outside advisors.
  • Target the right franchises based on your vision.
  • Consider working with a franchise consultant.
  • Speak with as many franchisees in the system you are evaluating.
  • Build your financial models by asking the right questions.
  • Figure out your funding plan.
  • Make a decision.

Why would someone choose to own a franchise over another business?

Franchising is not a fit for everyone. If you have your own vision, endless amounts of capital to invest, don’t like following rules set by others and want to run your show and not have to report to anyone another business would be a better choice.

A franchise has a built in blue-print for you to execute. The franchisor when creating the model has already done all the testing and made all the mistakes along the way to create a proven model. Their job is to make sure you don’t make those same mistakes so you have a speed to market and have the best chance to grow successfully and quicker than starting something on your own.

Why is Franchising considered a great career alternative?

Making the leap from employee to owner involves a shift of thinking. From Salary mentality to an employee to cash flow and asset creation of an owner. No matter how high ones salary is, or where they land on that corporate org chart, if you are an employee, you are every day renting your time and your talent to build wealth for a company that would and could get rid of you in a heartbeat tomorrow. 

As an employee, you have very little financial risk- the real risk is the ability to keep your employment for your future income. And as the saying goes, low risk, limit of upside potential or should I say the higher the risk the higher the reward? Owners take on more risk. They invest savings to create a business and so the risk is whether or not the business performs. The owner also derives the majority of the benefits should it prove to be successful. Once it is established, security of cash flow is gained along with tax benefits and the creation of an asset.

Basic risk/reward but it is the very foundation of what wealth creation in a free market economy is.

Is operating a franchise easy?

NO! It is a lot of hard work, dedication and a large amount of your time and attention and is not meant to be treated like a hobby that you will pay attention to when you have spare time. These are real businesses that require lots of love and attention. With the support of your franchisor and the corp team they are meant to be your business partner all the time, every day. They are committed to help you grow, but you have to do the work. You will be expected to execute.

Do Franchisors charge hefty fees for their own profit?

Wrong! As a franchisee, your payments to the franchisor consist on a one-time fee to buy the rights to expand their brand in your geographic desired area. Then, every franchisee pays royalties back into the overall system. These are typically weekly or monthly payments incurred for the life of the actual franchise agreement. 

It is vital to understand the actual purpose of the royalties. Without them, there would be no franchise. It allows the franchisor to build and most importantly maintain a comprehensive support system to aggressively develop its marketing programs -- to innovate and stay on the cutting edge of their industry. It’s a win-win for all involved. Without it, there would simply be no franchise system which, by the way, is the most valuable aspect of what the franchisee is buying after all.

Most franchisees feel the benefits are well worth the expense. Additionally, advertising contributions from each franchisee is also an expense. Marketing is key to any successful business so it would be wrong to require only one partner in this business marriage to be responsible for these obligations. Not marketing is a sure fire way to fail at any business so it is a huge advantage when the franchisor has already tested the marketing and knows what works and what doesn’t.

All Franchise systems are the same - right?

No way! They are all very different depending on the industry and market. Yes, there are basic elements that all franchise systems have to maintain, but most vary in respect to training, operating systems, branding & marketing guidelines and how they actually make money.

Requires Due Diligence. Anyone looking to invest in a franchise MUST thoroughly review the FDD to understand the philosophies of the specific Franchisor. This document sets the tone of the business marriage, if you will.

Chose a Franchise Consultant. A Franchise Consultant knows this process and will guide you through this process to a well-informed and successful end result.

Franchising only applies to Fast Food, right?

There is a lot more to franchising than french fries! With nearly 4,000+ franchises today in the US, many are non-food related such as service based. Rather than focus on a certain industry of franchise brand, take an inventory of your skil-sets, interests, experience and your goals. Be anchored by reality to define how much you can really afford with a franchise and what your income expectations are as well.

Let a Franchise Consultant Guide you. Remember our recommended Franchise Consultant's service is FREE and she will help you find the potential franchise from among this widely diverse possible choices.

Are you really in control of your business with a franchise?

As a franchise owner you are in control of your own business. Your franchisor will provide guidelines that adhere to their specific national brand, however you manage your business, your finances, employees, customers and your future.

Most have to quit their job to start their franchise - how do they choose wisely?

Wrong! While many are choosing to fire their boss and escape corporate America by becoming a franchise owner, there are plenty of satisfied corporate executives that are seeking diversification or building a transition path so that in the next 1.5-2 years they could fire their boss and become FT involved in a franchise. Some never leave their corporate position and scale through manager run franchises while keeping their pay check. Simply put you don’t have to choose one over the other - you CAN have your cake and eat it too!

Take Action Here - How to Get a Free No-Pressure Exploratory Discovery Consultation

Next Step. If this information strikes a cord of potential interest, you owe it to yourself to be open to getting enough information to make an informed decision. Contact Carl Bradford to arrange for a confidential brief discussion with our preferred Franchise Consultant so you can obtain the information you require. Click the button below now.

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