One of the core traits of entrepreneurs is not so much owning a business, but actually wanting to run one. This type of works attracts a certain type of person, people who are driven, who like to be in charge, who like being masters of their own fate. However, in order to get started, you need to have a sizable investment, you need to get the right marketing and operational support, and you also need to slowly build your brand. With a franchise, you can cut back on some part of this work.  

Namely, franchising means you get the rights to run a local branch of a business. For example, you acquire a franchise licence from a big restaurant chain, and you open your own shop (under their name) in your city. And while you will most likely need to pay certain royalties or percentages to the franchise on a regular basis, you will have a brand already prepared for you. You can fall back on their own strategies, setups, logistical systems, and sales tactics. Depending on the franchise, you will get a lesser or greater degree of control, but the core point stands – you run the day to day operations of a successful business.

However, in order to become part of the franchise, you need to do a couple of things first. In the article below you can find the basic tips and facts that will make it easy to start.

Do your research and figure out what you want

Don’t just choose any franchise that you come across. Rather, think long and hard, figure out what you yourself are passionate about. Even though you will not be building this company from the ground up, you will still be running a branch. This means that you need to have some experience and knowledge in this field, as well as actually being passionate about it.

So, if you have experience in the food industry, becoming part of a restaurant franchise can put your skills and talents to excellent use. The same goes if you want to run a café, or if you dreamed of owning a bakery. You need to have some background knowledge if you want to run a good electronics store. The better you know your products, the more familiar you are with the services the franchise offers, the better you will be able to run it. You will be able to provide better customer satisfaction, as well as handling suppliers better.

Get the right funding

In order to begin with a franchise, you need to get the right funds. Namely, becoming a franchise owner is not cheap. The initial investment will probably not be as high as the one you use when opening your own company from scratch, but you will still need substantial funds.

Now, there are several options you can choose. For example, you can get a simple business loan from the bank. You might be able to apply for a start-up business loan, or actually get the money form the franchisor (the legal entity issuing your franchise licence). Namely, some franchisors offer you the option of actually lending you money so you can get their franchise. This, of course, carries with it certain issues and obligations. On the other hand, franchisors might not directly provide you money, but would rather give you invaluable advice and assistance with getting a licence.

Choose the right location

Before you sign the contract and get your licence, you need to figure out where you are going to set up this franchise business. It’s a very clear and honest fact that you can find more than one franchise business opportunity in Sydney than in any small city. You can find more offers, as well as a stronger market and more customers. So, if you are really dead set on owning a franchise, do try and think about where you are going to get it set up.

You will notice that most franchise contracts require a minimum (and maximum) number of square feet that tare to be used for the franchise building. They also often have other requirements, like parking spots. Another issue is “protected territory”. This represents the area within which a franchise building is already in place. You are not allowed to set up your own branch there since you’re creating unfair competition.

Of course, basic business rules apply here as well. You need to strike the right balance between expenses and exposure. On one hand, you want to go to an area that receives a lot of foot traffic, and that people will actually visit, especially if you are working with a restaurant. On the other hand, you need to be able to pay for rent, expenses, and permits that surround popular places and areas.

Think about your contract

Finally, once you’ve taken all of the above into consideration, you need to think about and analyse your contract. Namely, are you fine with the stipulations placed in the agreement? Can you handle the royalties this franchise requires of you? What about the amount of freedom and autonomy they offer you? How much control do you want to have over marketing? What about decor, or style? Do you get to choose your own suppliers, or are they all provided by the company?

Furthermore, does the franchise offer you training seminars and sessions, or are you supposed to learn as you go? Do you think their internal policies and guidelines are too constricting?

Conclusion

Becoming part of a franchise is essentially like being an entrepreneur with a safety net. You get to run your own business, you have control over the day to day actions needed to keep an enterprise profitable, all the while having some support and ready-made strategies and plans right there for you. Just remember to think about the funding you are going to get, review your contract several times over and, of course, figure out what kind of franchise best suits your needs first.