10 Things you must know: Be prepared with our tips from franchisees and franchisors
In this spirit, Franchising Magazine has cherry picked the best snippets of knowledge about franchising from those in the industry – to help your understanding of what matters before the business is yours.
So, what do you need to know before you buy a franchise? Michael Janos, Computer Troubleshooters Franchise Mart and knows what it is like to start up in a new industry.
"Looking back on my time as a Signarama franchisee brings back memories of uncertainty. Before I attended the Signarama training school I was nervous and unsure about my decision having little knowledge about franchising, no knowledge of signs and no customers; how were we going to be successful? What is interesting is that at the training school, all of the students felt the same way.
"If I could share a thought with people looking to become a franchisee, it would be listen, take advice, be humble and ask for help. You have bought a franchise business with a successful business model, so replicate the business and it will increase the chance of success.
"Change brings uncertainty, whether it is the purchase of a new house, career change or investing into a franchise business. However what matters is how to deal with those changes. People deal with change in different ways but in franchising it is essential that the new franchisee does not start their journey on franchising being arrogant, opinionated or unwilling to listen to the franchisor. The most successful franchisees are the people who can take on board recommendations and suggestions from the people who have been running the franchise operation.
"Asking the franchisor questions, seeking advice, or asking for help is not a sign of weakness, it shows that the franchisee is willing to listen, learn and grow a successful franchise business."
5. Research, research, research
But beware; owning your own business is hard work. As Kerry Noyes, regional franchisee for Fastway Couriers (Gold Coast) says "...the rewards are definitely out there, but they won't just fall in your lap. If you want the easy route, become an employee, not a franchisee".
"As for the secret, it's simple; research, research, research! It's the key to your business success. Do your homework, check out all of your options, and don't rush into the first business opportunity you see. If you put the effort in, your persistence and diligence will pay off a thousand times over."
6. Do comparative advertising costs
Shane Hodskiss, Aussie Farmers Direct , says looking at a full range of advertising costs/methods/results to compare from the start rather than learning through trial and error would have been very handy.
"Every advertising method or outlet will only tell you the benefits of their service; the full story is only available through speaking to everyone as their strengths are usually the opposition's weakness, giving you the knowledge to make a decision. Shop around and think outside the square as costs and results vary greatly."
7. Check out the official guides
Monica Longmire, Just Cuts franchisee, Belconnen & Woden says that the government can really help you get started. "We researched for two years before buying our first Just Cuts franchise in 1994, so we knew what to expect. However the government didn't provide as much franchisee support then as it does now. I'd recommend that any potential franchisee obtain all information possible on franchising from various government bodies. Publications such as the ACCC's Franchisee Start-up Checklist, the Franchisee Guide to the Franchising Code of Conduct and the Franchise Bulletin are all especially useful. They provide a simple, clear and concise guide to help the franchisee cover aspects of entering into a franchise."
8. Finance, finance, finance
Tony LeGall, Pack & Send franchisee, East Perth says at the end of the day, the money is all that matters. "Finance, finance, finance! To me, the most important thing is to get a solid idea of the financial well-being of the company as a whole. It's also beneficial to be able to analyse the individual franchisees, speak to as many people as you can about their business model and the benefits of being part of an integrated system. I did this before purchasing my first Pack & Send franchise and it was critical in building my picture of the system and its networks."
9. Keep a balance
Jonathan Atherton, My Home Gloria Jeans restaurant and cafe franchise, says there's no substitute for hard work. "Although you are buying into an established franchise model, basically what you put into it is what you get out of it. It's hard work, there is no silver bullet, and you need to continuously invest in your business on an ongoing basis through training, development and marketing - never taking your eye off the ball. Also one needs to work in the business and on the business, nothing replaces real product knowledge when delivering service. In our business this is all about quality, consistency and providing a great guest experience."
This article appears courtesy of Franchising Magazine.
The Franchise Council of Australia is a not for profit membership organisation that is the peak body representing the franchising sector in Australia.
24.06.2008
FCA Member
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