American orator William Jennings Bryan once said, “Destiny is no matter of chance. It is a matter of choice.” When you decide to move forward in entrepreneurship, you’re going to find yourself overwhelmed with choices. There are nearly 3,000 different franchises in the US today and more than 740,000 unique franchise establishments. There is truly no segment of our economy franchising doesn’t touch. With so many options, it can seem impossible to winnow the massive pool down to just a few prospects. A franchise consultant can help make this process manageable, but you can start by looking at these four main qualities that are the hallmarks of top franchising companies and promising investments:
1. Proven Systems. Systems are the backbone of a good franchise business. The business must be repeatable, with solid methods and procedures in place that leave no room for error. What kinds of things are included in this? Typically, you can expect to see standardization of facilities, highly optimized equipment, thorough training, and depth of franchisee support for starters. A business can have a brilliant concept, but without proven systems, it won’t fly as a successful franchise.
2. Strong Brand. A franchise doesn’t need to be a household name to have a strong brand, but it does need a positive and consistently presented public image. If it’s a new, early adopter concept, it should be well on its way to having those traits. How can you tell? Read about it. Study reviews. Visit a facility. Talk with people on both sides of the transaction. These steps will get you started in the process of finding a winner.
3. Solid Financials. Any franchise company you’re considering making a sizable investment in needs to be financially strong. Don’t take anyone’s word for this. When you get your Franchise Disclosure Document, take the time to understand the financials reported there.
4. Happy Franchisees. The best indication of a solid franchise opportunity is happy and successful franchisees. There’s no substitute for this simple, powerful barometer of franchise excellence. If the people who have taken the leap before you are satisfied and successful, that’s the best possible indication that you can be satisfied and successful, too.
5. Win/Win/Win Formulas. At their core, all truly successful businesses work because on some level, both the business and the customer are satisfied. In franchising, that balance has three components: franchisor, franchisee, and customer. If everyone is coming out ahead, then you’ve found a win/win/win program worth further exploration.
Ready to HIRE YOURSELF? I’ve created a quick list of questions you can use to evaluate franchise businesses. Follow this link to start using it today.
[link: QUIZ: Identifying a Great Concept: What’s the Win/Win/Win?]