So many franchises…How do I choose the right one?
A wise man once said, “If you don’t take a risk in life, you will always find yourself working for someone who has.”
Finding your true calling in life often involves taking risks and making a leap of faith. For me, I took my big leap into the world of being my own boss over 25 years ago and have not looked back since. I have been involved in almost every aspect of the window covering industry. I have been a successful independent business owner, a design consultant, a franchisor, a national trainer, and a personal coach and mentor. I want to use my experience, and the experiences of others, to help you decide whether franchising is right for you.
Most people would like to be their own boss. Yet when they think about business ownership, many assume they’re talking about entrepreneurship and starting their own business, without even considering the alternative – Franchising. The truth be told, franchising offers a much higher chance of success due to the fact that roughly 90% of all new franchisees succeed and only 15% of entrepreneurial ventures achieve true success. Why start from scratch and re-invent the wheel when all this can be in place for you with a proven business model and strong support system?
Franchising seems complex and confusing to some. Many people don’t seem to realize that franchising is quite simple and a much safer alternative to business ownership. I hope this article will help you make a well-informed decision as to whether franchising is right for you.
So let’s get started. To your success!
Many people have lost faith in the biggest traditional wealth/security creation strategies that we’ve been relying on for decades (real estate, financial institutions, stock markets and corporate employment). In turn, a new solution now appears to be emerging due to this loss of faith, as experienced corporate professionals search for ways to stabilize their financial portfolio and begin the rebuilding process. Is self-employment the answer?
More executives are now considering self-employment options where they can leverage their knowledge and experience, and rely more on themselves for their own future security. They are discovering that franchising is the solution to seek non-traditional ways to maintain their lifestyle and rebuild their wealth and security. Over the last decade, the rate of interest appears to have more than doubled.
More and more people are attracted to franchising, which when done correctly, provides good systems and structures, a proven track record of success, and is typically a far safer option than starting out on one’s own.
“I’ll Know it When I See It”:
To find a franchise, we’ve seen that almost all people start their business search with one of two methods:
- Look at which franchised businesses and/or industries are performing well; or,
- Look for types of products or services they really like. Then most of these people surf the Internet or go to the franchise shows and hope that they will find something that appeals to them – This is the “I’ll know it when I see it” syndrome. The scary part is that employing either of the above methods prematurely is one of the biggest mistakes someone who’s looking for a business can make, because there is a great peril in each of these scenarios – here’s why:
For the first option, just because other people have achieved success in a business does not automatically mean that everyone will. What does determine success is how well suited the owner is to performing the key roles that determine success for their business.
Even franchisors with very strong brands don’t take someone on just because they have enough money. Instead, good franchisors go through a rigorous matching process to make sure that the individual has the necessary skills and ability to perform the key roles that drive the business. When you think about this, it’s no different for an employer who is looking to hire the right employee – their decision should be based on the candidate’s skills/ability to fit with the key roles of the position, not just their desire to do the work.
Suggested exercise #1:
- Make a detailed list of the core skills which you possess, that you want to leverage in a new business;
- Rate which skills are most important and impactful for you, second most important, and so on.
The common view is that a key requirement to be successful in business is having a passion for a particular product or service. This is simply wrong thinking! Instead, I believe that to be successful, the business owner doesn’t have to love, or even like, the product or service. Instead, they must have:
- An absolute conviction in the value offering to the end user client;
- Passion that is connected with the key roles that drive the success of the business.
Having passion for the product or service is a bonus; not a necessity. Take the owners of a housekeeping service business – do they like cleaning? Probably not. Instead, they like managing people and business systems, enjoy marketing, and also like interacting with people. They’re convinced of the value of the service they provide and therefore can persuade others that it’s worthwhile to buy – from them.
Suggested Exercise #2:
- From the first list, identify which roles give you ongoing, long-term satisfaction;
- Make a list of things you don’t enjoy doing and that you would not be prepared to do day-in and day-out (e.g. cold calling )
While considering the above scenarios, you’ll also want to consider that some of the most successful businesses are those that offer basic products or services, AND a proven and sustainable demand for the product or service.
These include basic, non-flashy businesses with little “curb appeal”, as well as the more “glamorous” businesses. This also means that there could be a lot of competition.
Unfortunately, many people overlook a lot of business opportunities because of the perception that there’s too much competition, when this actually works in the franchisee’s favor. Strong franchise systems are very savvy and sophisticated, and therefore consistently outperform independent operators. So, would you rather have a business with lots of competition, but with proven and sustainable value differentiators, or would you rather be in a niche business with few competitors – and possibly, a lot fewer clients?
Regardless of whatever industry and business you might be attracted to, the two most important things to remember are that;
- Your success will be primarily determined by how well you fit the key roles of the business you eventually buy, and;
- Your motivation to drive your business and overcome the challenges you’ll face will come from what the business will do for you personally.
In order to significantly increase your odds of finding the RIGHT business, this is where you should focus first: Reverse engineer what your ideal business looks like. Instead of trying to find a few good business possibilities by first going to the Internet or to franchise shows, what you need to do instead is “reverse engineer” the whole search process by first determining the ideal business model: what you’re good at, what you’re not good at, what your key criteria are, etc., as well as determining what your short-term, mid-term, and long-range goals.
Next, start looking at only those options where the franchisor’s business model is a close match to what you’ve defined in the reverse engineering process. Only then are you prepared to successfully analyze any franchise – against the criteria and needs that you’ve defined, not against other business opportunities. Think about it. A franchised business is nothing more than a vehicle that’s designed to get you where you want to go, while enjoying the ride along the way… In other words, it must be able to satisfy your financial and lifestyle goals!
While business ownership is hard work, most people usually find that they have way more drive, energy, focus and satisfaction, than in their existing careers. After all, financial gain is only a by-product of a well-run business where returns are commensurate with well-focused efforts. When you find the right business for you, you are in a position to build wealth on your terms. Franchise ownership is not always a right fit for everyone, but when there’s a strong fit, it’s a great place to be! Owning a franchise is not just about realizing your financial goals, it’s about having a lot of fun along the way!
Keep in mind…when you find something you truly enjoy doing, you will never work another day in your life!