Buying a franchise is similar to buying a house — both are monumental decisions that require you to go through a process that happens in stages. These stages take time and necessitate that you do certain things before you can “move in.”
The first stage involves shopping for a franchise that meets your business needs. Some of things you need to consider include: financial concerns and whether you want to buy into a fast-growth or slow-growth franchise system. Obtain a copy of the franchisor’s Franchise Disclosure Document (FDD) and examine it thoroughly at this stage.
Once you have selected a franchise and signed the initial paperwork, assemble your business plan, arrange for financing, and begin looking for a possible business site. Financing is the key element because without it you can’t advance to the next stage. Even with bad credit or no credit, you still have options.
After you sign the final paperwork and pay all or part of your franchise fees, you have essentially bought your franchise and are ready to begin the final stage of the process. The questions that most arise at this point are:
- What steps do I need to take before I can open for business?
- How long will these steps take?
The franchisor can usually provide you with a checklist of things a franchisee needs to do to open, along with a rough timetable of how long each step will take. This is important because things that take the longest need to be started early on.
After you have been granted your franchise, you must secure a physical location, which often includes negotiating a lease or sale of property. And you have to deal with hiring employees to staff your company, something that many new business owners can find rather intimidating if they haven’t hired people before.
The period between when you buy your franchise and when you actually open for business is your time to mentally prepare for the exciting challenges ahead. Most franchisors offer an intensive training program for all new franchisees. During your training session you should be given an operations manual that will become your “go to” guide for all questions regarding day-to-day operations.
Other steps you may need to take include decorating to conform to franchise requirements, acquiring equipment and inventory, training your managers and employees, and coordinating with the franchisor on any grand opening activities. Often the franchisor will send representatives to assist you during the first few days or weeks of business. They will also help you with marketing and promotions to help make your opening a success, as well as show you how to keep your customers coming back.
Remember, things often take longer and cost more than you initially anticipate, so allow for some wiggle room in your schedules and budgets. Make daily and weekly lists so that you can track each step as it happens, making sure it gets done in a timely and cost-effective manner.
Soon you will be up and running, and realizing your longtime dream of business ownership.