There are many factors that can go into the decision to open a franchise. We have covered many of them previously through a variety of ways, a simple look through our back catalogue of articles proves that. But how can you evaluate if a long-term franchising opportunity is the right fit for you and has the capability to be a business that you run for the next 10-20 years or even until your retirement should you choose.
Sustainability
For once we aren’t referring to the green credentials of the business (although still important), when using the term Sustainability, we are looking into the industry sector as a whole. Is the business based in a growing industry? At what rate is it growing? Both these questions consider the popularity of the sector, as with a rapidly growing industry you can quickly run into direct competition for your business.
With longer term businesses you also need to consider global economic pressures, for example is the business recession proof? Many businesses were found to be unsustainable as soon as the cost of living started to rise, seeing their customers dwindle to 0. Secondly and a rather new consideration that many entrepreneurs are now considering is if a business is ‘pandemic-proof’. Should the country be forced into a lockdown can the business still operate at a sustainable level? Would it be considered essential work? If not can the business weather the storm to keep going when things return to normal conditions.
On the more positive side of things, potential franchisees should consider how scalable a business is. Will the business reach a point where it needs to expand to another territory, does the franchisor allow this or are they forced to maintain their position at a certain level. What diversification options are there if the business proves to be a success? Can you offer expanded services should the customer request it, are those secondary services scalable into their own operations.
The Business Model
When looking at specific franchisors there are definitive factors to determine their business model is successful, these should be easily accessible from the franchisor in most cases.
- Age of the Franchisor
- Oldest Franchise
- Most Successful Franchise
- Number of Franchisees making over £X
- Number of Franchises
- Number of failed franchises
- Rate of growth (How many new franchises per year)
This information is going to give you a better insight into their business model, and their mindset for franchise recruitment. The length of time they have been franchising for will help you understand how experienced they are in the sector and how much training, support and advice they can provide to help you make your new enterprise a success.
Business Support
The training and support provided by a franchisor must set you up to succeed from the outset, giving you the confidence and opportunity to build and grow your business. A good franchisor will provide ongoing training to develop your expertise and skills helping you to expand your franchise further increasing revenue and customers. Of course, some business owners are more experienced than others so will need less support, however it’s important that you are building the business to the Franchisors standards and following their guidelines to ensure your franchise still maintains the company branding, services and procedures.
Your own interest
If you are looking to build a business that continues long into the future, you had better make sure you have an interest in the subject area. While not necessarily essential to the success of the business it can prove beneficial to your own personal satisfaction and wellbeing. This will be a subject you will have to dedicate your life to for years, so make sure it isn’t just a passing hobby that you will lose interest in within a few months.
For more information about franchise opportunities in your area please get in touch with our team here: revivefranchise.com/contact-us/
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