Is it profitable to buy a franchise? This question often worries those who are planning to start their own business and only choose their own path. Unfortunately, many consider buying a franchise as an easy and fast way to earn money, where you will only need to receive money and exercise general control. This is the first common myth. Another popular misconception is that it doesn’t matter which franchise you buy, as long as it’s already profitable.
Alas, that doesn’t work. And the first thing to do for potential entrepreneurs who decide to work under someone else’s brand is to choose the right future business. We will tell you how to do this below.
6 Rules for Choosing a Business
1. Choose a business for which you have an internal predisposition.
If you have been dreaming of your own studio all your life, and instead decided to sell auto parts (and you don’t have your own car), then it’s a matter of time when you start to regret the step you took.
2. You must be able to understand your area.
Or at least be willing to learn what you do not yet know how to. You are an investor and buyer, not a hired production line controller. This is about the fact that they will teach you everything and show you everything.
You should understand that you will have to develop your outlet and promote your business on social networks. However, if you don’t understand your field at all, then you simply won’t be able to write a post for Instagram, or answer a potential buyer’s question in the comments.
Because of this, many entrepreneurs are forced to have empty accounts of their stores, or write useless posts and buy Instagram followers in order to attract at least some kind of audience. Of course, this can help you get a certain number of buyers, but there is a high probability that you will lose them already at the time of placing an order, because you will not be able to tell the details of your work.
3. Assess the readiness of the franchise holder for its development as a whole.
To what extent are they ready to develop their brand, in what ways, and how conscientiously do they do it?
4. Does the franchisor have a staff training program?
Relatively speaking, there is a certain individual scheme according to which the business in which you want to invest works. Therefore, there should be a program in place for training personnel according to corporate work standards.
5. Decide on the seasonality of the business and prepare social networks for opening.
This is no less important than taking into account the predisposition and the presence of some features. A simple example: a place selling ice cream will bring more profit in summer than in winter, as well as renting summer equipment (bicycles, scooters, etc.).
If you are planning to launch a business for the summer season, then it is advisable for you to start promoting it at the end of winter, maximum at the beginning of spring. You can resolve all issues with the location and rent in advance (in autumn), and from February to March, start managing the social networks of your store or service.
Already at this stage, you can attract the first target audience. In addition to flashy banners, you can set up polls and encourage users to respond to your Stories. In order to get the maximum number of potential buyers, you can buy real Instagram followers using special services. However, do not forget that in the future you need to somehow retain these followers in your account.
6. Visit 3 to 6 points of your future franchise.
Order a product or service yourself, chat with sellers, evaluate their customer service. You should even chat with the owner at any point about doing business.
Types of Franchises You Should Consider
Here and below, relying on our experience and monitoring popular opinions, we have listed the types of businesses that can be bought in 2022 with an eye to further development.
So, what can you safely buy? In our opinion, we can consider:
- Medical laboratories. Taking care of health is always very important, and besides, Covid-19 is not gone yet.
- Online grocery stores. Food is always relevant.
- Logistics services, food delivery services.
- Repair of household and computer equipment. With the price of new technology high, people often need help extending the life of old gadgets.
- Accounting and financial optimization of outsourced business.
Minimum own funds
All that is required of you, as a new owner, is to focus on marketing and business development strategy in your region, while the franchise owner will be responsible for promoting and maintaining the viability of the franchise.
Save on time and money spent on attracting customers
Everything is simple here. They will be attracted by the brand itself, which is already promoted throughout the country.
Do think about how the following disadvantages may affect you, instead of the benefits from the convenience of buying a franchise.
Sale of a magic pill
At the beginning of the article, we said that the buyer often starts his business under someone else’s brand, living only in dreams. They think that they will be taught everything from scratch, and they will only have to receive money by controlling an already-ready business. However, the owner of the brand can also act as a seller of miracles, who, convincing the buyer for a deal, will consciously begin to focus his attention only on the benefits. They will say very little about difficulties, or say nothing.
Mandatory initial one-time payment
This is a payment for the opportunity to work under the brand. The very fact of its presence for someone may be a deterring factor, because the funds for this cannot be raised.
Here you need to remember that you did not open your own business, but use the right to conduct one under a foreign brand. This dependency over time may not suit anyone, so immediately think about how comfortable you are always following the instructions from the management.
Let’s summarize. The first thing to always remember is that franchising is not a magic pill that will turn you into a millionaire. So if you decide to invest in this, then be prepared to invest a lot of effort. The brand holder will definitely appreciate that you are putting in due effort and will not leave it unattended. Sitting idly by after the down payment in the hope that the new business will work on its own is not worth it.