See this matter which is the step by step to choosing a franchise. We did a complete roadmap for those who want to settle in choosing a franchise and make a safer option when opening your business.
The TinoShare.com team developed a step by step to choosing a franchise, as many of our readers wrote to us saying they feel means lost time to start your search.
The process of choosing a franchise is not as simple as some people think. This is not only to get excited about the business and embark on the endeavor. It is necessary to analyze various aspects of the business and plan a lot.
To facilitate decision-making, our team has researched and developed a step by step to choosing a franchise, based on several publications made on our website, which you use as a reference in time to open your business.
Find a segment with which you identify
The first item of our step by step to choosing a franchise is to choose very well the sector in which you want to present. Remember that you are entering into an agreement which will require a lot of dedication and effort, so it is necessary that the industry has a good future prospect.
A big mistake that has been made in recent years by new entrepreneurs in the franchising segment, they fall in love with a kind of “franchise fashion” and then when it’s too late, discovering that the industry has a good growth outlook medium / long-term or so, the market is saturated.
What are the prospects for the segment
The business model is easy to copy or has characteristics and specific techniques.What are the barriers to entry?Another important point is to analyze what are the prospects for growth and renewal of the sector. Does the sector has shown good growth in recent years?
If the industry you choose has several competitors, search for whether the market would not be saturated and competitors are involved in a real price war to ensure their participation. Sectors in such a situation tend to have very tight margins.
Which the concept of the brand?
Another point of our step by step to choosing a franchise is to investigate the brand. Often, the main selling point of the franchise, especially the youngest, is out there it is a success.This is no guarantee that this success will be repeated here.
Another tip is to search the Internet what it is talking about the brand. Visit websites specializing in franchises and business, discussion forums, articles about the brand and other references.
Franchise or startup
Give preference to brands already well established and with a good reputation in the market. Many franchises, especially the new ones, are launched in haste, without its processes and methods are well detailed and sedimented.
They are what we call the startups in the form of franchise, that is, the idea is good, but the product and the processes are not yet mature enough to be part of a real franchise. In these cases, you’ll be buying much more an idea than an actual franchise.
Find information with franchisees
Another step that could not miss in our step by step for choosing a franchise is contact with franchisees and former franchisees. Seek to know them which concept they have of the business, the support given by the franchisor and the financial reality of the business.
It is interesting to question the franchisor about the plans of brand expansion and make sure it has or not enough structure to implement these plans. Do not be fooled by miraculous predictions, especially in a crisis environment as the acts as they may not materialize.
Analyze the competition and the environment
Another important item of the walkthrough for choosing a franchise is to analyze the competition you will face and the available market. If you already have an idea of where you want to install your franchise, check for a competitor in the same segment in the vicinity, as this could mean trouble for you.
Another important tip is to know very well the audience’s habits of the region and see if this audience hit with the target audience of the franchise you want to buy. There needs to be full compatibility, otherwise their spending on marketing can make their exploding costs.
Even analysis and franchisor support
A crucial item to determine the business viability is the issue of location. It does not help a good deal in a bad place. No matter how good the deal, if it is poorly located, it just does not walk.
If renting a property in the first place, and negotiate the rent, especially now, in the midst of crisis is there, it is easy to get a good discount. The rental amount should be between 10% to 15% of the revenues planned for the business.
Do accounts and bills
Another item that could not be left out of our step by step to choose a deductible is the issue of calculations. Make a detailed plan of all the expenses they will incur, franchise fee, operating expenses, working capital and always include a provision of 10% to 20% for unforeseen expenses, especially during installation.
Always try to choose a franchise whose design fits in your budget. Of course you may use the funding to create your franchise, but in times of high-interest rates, it is quite risky, so it is best avoided.
Now that you have the step by step to choosing a franchise, just get organized and start the analysis. Stay up to date about investing in franchises and other business opportunities by subscribing to our Newsletter.