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Love at first sight? How to pick right when buying a franchise

Sarah Stowe

Do I look okay? Did I overdress? Maybe I underdressed?

You’re getting ready for that first date. Butterflies in your stomach, checking your hair on your camera phone over and over. That’s when you’re not checking the screen every five seconds to see if they’ve texted. Your date likes you, and you like them. They are so likable, exciting, and make you grin from ear to ear. You knew it was love at first sight when you saw them initially. The feeling inside was electric. It has to be a match made in heaven.

Much like a first date, choosing a franchise you are passionate about can get you all giddy and googly-eyed.

You’re getting ready to meet the franchisor. Butterflies in your stomach, checking your interview notes over and over again. That’s when you’re not reassuring yourself that you’ll be fine because you love the brand and product so much. It’s everything you believe in. Their business values are your values. And surely the franchisor likes you if you’ve been picked for interview. You knew it was love at first sight when you saw the branding in your teens. The feeling inside was electric.  And the franchisor is so nice and easy to talk to. It’s sure to be a great investment.

But we all know that a relationship is more than just the initial thrill of eyelash-batting, daydreaming at work, and intermittent blushes. Behind the perfectly posed, power couple photographs are the ups and downs, compromise, and hard work needed to keep those smiles genuine.

True love is a marathon, and a solid franchise relationship is no different. Behind those glitzy awards night pictures and annual conference fun times is a backstory of hard work that needs TLC too. It’s a balancing act of emotional appeal and practical thinking.

Initial idealism that will hook you in:

  • Love for brand: It’s important to be passionate about the brand and what it stands for in order to franchise. Without that drive, term agreements can seem like forever. And as Confucius said, “choose a job you love, and you will never have to work a day in your life.”
  • Love for product: Believing in the product or service will also go a long way. If you love the product, it will shine through to like-minded staff and to your customers. If it doesn’t, you might start asking yourself why you invested in the franchise .
  • Established brand: Yes, an established brand nationally or even internationally can work in your favour. Household names are recognized and loved in the community, so you don’t have to worry about the uncertainty of whether there is a market in place for your product or service. Often franchise networks within established brands come with a lot of support for franchisees.
  • Society says yes: Like a romance, business is a two-way street at the end of the day. To make profits and succeed, the market and overall community (including your own family) will ideally have a positive reaction to the franchise. Business creates business, and positive attention can also be a plus.

Practical points that will keep you committed:

  • Legal: When purchasing a franchise, what seems like dry paperwork is a must. Legal advice is necessary for understanding the structuring of your purchase, due diligence and franchise documentation, and contracts. Legal support is also available within most franchise networks for your perusal.

When do I need to find a franchise lawyer?

  • Financial: We all know that dreams are a beautiful thought, but are actualised with the practical components. In the case of franchising, financials are a major practical feature for the investment. Having enough funding is integral to getting through the early stages of business when franchising, especially if there is downtime in the first few months or years.  

How to work out your budget when you buy a franchise

  • Administrative:  Time and time again, franchisors say that many potential franchisees underestimate the behind-the-scenes work required to run a business. This includes human resources, OH & S, overhead costs and maintenance, local marketing. Again, most franchise networks provide support for these aspects of the business, but as the franchisee, it’s your job to complete.

So before you go all in and put your cards on the table, make sure you’ve balanced out the sentimental value with the logical reasoning so you can live happily ever after!