4 tips for first time franchise owners
Ready to invest? Choosing a franchise to invest in can be challenging, even if you know what industry you want to invest in!
Before going forwards with your chosen franchise, make sure you’ve done the work and the research. Put the effort in now and you won’t have to worry if you’ve made the right choice in the future.
Here are 4 steps to help you when you’re choosing your franchisor. Remember, it’s equally as important to take the time to find the right fit, as it is to get your investment going.
1. What do you want in a franchise
It goes without saying that as an investor you'll want a solid business plan and product to invest in. That doesn’t necessarily mean investing only in established brands, there may be a startup out there that’s the perfect fit for you and checks all the business boxes.
But what other factors are you passionate about? Are you passionate about the community and community driven initiatives, find a franchisor that has a strong link to the community. . Are you passionate about innovation, find a franchisor that is always looking to develop it’s product further.
Do you care more about the level of service and attention you receive from a franchisor? Work with the company that gives you the highest level of attention and works with you to help you build the business you want. Avoid those companies that leave you waiting for responses or appear interested only in your investment, not you as a person.
2. Do your research
This is obvious, but it's not unusual for an investor to not do their due diligence. At Hybrid we take all franchisees and potential investors through our multi-step process. Here investors learn all about opening and operating a gym, learning about the different aspects of the business and learning more about the business model.
Once you’ve started your initial conversations, make sure what’s said matches up with the product. Try the gym and some classes, send someone you trust if you don’t fancy doing it yourself.
Set yourself up for success by enquiring and then testing. You want to make an informed decision rather than jumping into bed with the first franchise you come across.
3. Understand your finances
Each franchise opportunity comes with different levels of investment. Some franchisors will help you to secure funding from the bank, or at the very least give you the instructions of how to do so.
Whether you have the money ready and available or you’re taking a loan, having an understanding of the costs involved and being in a financially stable position can be helpful.
It’s also wise to have a good understanding of where and how the money will be spent. Speak with your franchisor before investing, that way you won't be surprised when money starts leaving the account!
4. Don’t invest if you it doesn’t feel right
You could be at the point of signing an agreement and you may have a feeling of uncertainty. If you aren’t convinced that this is the investment for you then stop.
Assess what you’re looking for from a franchise and make sure the values of the franchise match your own goals. Are you going to be happy emotionally, professionally and financially with this investment?
Are you being given the support and the tools you’ll need to open a thriving business. Have you had a level of support that goes above and beyond. Is there trust between you and the franchisor?
If any of these feel off, then walk away.
At Hybrid we pride ourselves on our transparency and openness. We work closely with all our franchisees to help them open the gym they want and the gym the area needs.