Buying into a franchise can be a great investment, but there are going to be potential pitfalls around every corner. Even though some franchises have a success rate of around 90 percent, those who mismanage their business might not see any profit for quite some time. If you have recently thought about buying into a franchise and want to put yourself in the best possible financial position, then take a look at these six master tips that will improve your chances of success in the coming years.
Be Ready for Peaks and Valleys
No matter how much time and energy you spend researching an industry, you need to be ready for a volatile market. Even if you are buying into a well-established franchise with an excellent record, there could still be weeks or months when you get little or no business. Franchise owners must have the assets to survive those periods and move forward. As time goes on, those peaks and valleys should slowly become less severe.
Get Creative with Your Advertising
One of the best aspects of owning a franchise is that some of the advertising and brand development might already be done for you. That being said, you will still need to think about how you can get the word out to the local market. In addition to traditional mediums such as radio and television, you might also want to work closely alongside local organizations such as schools, non-profit organizations, and other businesses.
Spend Extra Time on the Hiring Stage
The franchise will most likely have at least some rules regarding hiring practices, but those rules might not be enough. Your first few employees could make or break your business, and you must be absolutely sure they are a good fit. In addition to meeting the minimum qualifications, they also need to work well with others and have something unique to offer the company.
Take Advantage of All Franchisor Opportunities
Every single franchise is slightly different, but most of these companies offer their franchisees at least a few basic resources. Before opening your doors, you should go through all of the information that they give you to see if there are any useful perks. The company that you are buying into might offer a wide variety of services such as corporate training or cheap business supplies. During those first few years of business, those resources might save you quite a bit of money.
Personalize Your Insurance Policy
Insuring a business isn’t the same as purchasing a policy for a home or car. You will most likely need very specific insurance to cover the unique risks that your business is going to face. An entrepreneur who opens a used car lot will need much different insurance than an individual who buys into a travel agency franchise. Some franchises also require owners to have specific policies through certain companies before opening their doors.
Help the Franchise Grow
Franchisees have a unique relationship with franchisors. While your franchisor isn’t technically your boss, they are going to influence your business. Trying to help the entire franchise grow will put you on good terms with the corporate team, and that could be invaluable later on. Some franchises also have incentive programs for top producers and dedicated franchisees.
Even if you spend months researching the market, you need to realize that some variables will always be out of your control. Learning to move past those issues without breaking stride is an invaluable skill for entrepreneurs who are ready to take control of their financial future.