Like marriage, buying a franchise is a long-term commitment.
Before you say yes, make sure you understand to the in's and out's of franchising what it takes to be successful.
Be Your Own Boss. The phrase is repeated often in franchise circles, and it can be intoxicating to those considering franchise ownership. It means freedom from the typical 9 to 5. It means control. It means you call the shots. All of this is true, but being your own boss also means that you have responsibilities. You are responsible for your employees, your customers, and your business. Their well-being is in your hands. That is why it is essential for anyone considering franchise ownership to weigh all the factors that go into being the boss and understand what it takes to be successful. Franchise ownership is a long-term commitment much like a marriage. It’s good to treat it that way, from courtship – researchingbfranchises – to “I Do” – signing the Franchise Agreement. Remember the goal is happiness and financial independence.
The Attraction – Why Franchise Ownership Is Enticing
Franchising has a long and varied history, beginning, some say, in the Middle Ages, when local governments gave church officials and others a license to assess taxes. In the 1900s, franchising blossomed when General Motors franchised car dealerships. It spread even further, in the 1950s and ‘60s when convenience food services, such as McDonald’s, began to dominate. Franchise businesses have a solid history of success, so the appeal is obvious. Plus, the franchise sector is healthy.
According to The Franchise Business Economic Outlook 2015 produced by the International Franchise, franchise businesses grew at a faster pace than the rest of the economy for the last four consecutive years. Franchise business growth is expected to continue at that pace through 2015. The IFA forecast predicts:
- Franchise businesses will add 247,000 new direct jobs this year, a 2.9 percent increase to 8.8 million direct jobs, over last year. That is on top of the 235,000 franchise jobs that were added in 2014.
- The number of franchise establishments will grow this year by 12,111, or 1.6 percent, to 781,794.
- Economic output from franchise businesses is estimated to increase by 5.4 percent over last year to $889 billion.
- The gross domestic product of the franchise sector is projected to rise by 5.1 percent this year, which is faster than the 4.9 percent GDP increase forecasted for the economy as a whole. The franchise sector will contribute about 3 percent of the U.S. GDP in 2015
Franchise businesses offer owners brand recognition, a successful system of doing business and support (capital and operational) from the franchisor. But franchise ownership is ownership, and with it come the realities of ownership. Franchisees must hire and fire employees. They have to understand cash flow and ROI. They may lay awake at night worrying about making payroll or negotiating a lease or getting customers through the door.
Read the rest of the eguide before saying "I Do" to a franchise.