Friday, January 13, 2012

Is Buying A Franchise For You

I had a very interesting discussion with a friend who wanted to put-up his own business. He said that he doesn't have the experience and enough capital to venture out on his own and create his own product or brand. He is thinking of getting a franchise.

I understand him and I advised to get a franchise concept that is new and not easily copied. Food carts are a no-no since I know many food cart businesses that have lost money. Also, food cart concepts are quite similar to each other. The market is already flooded with choices.

He asked me for some tips and advice on how to choose the right business to franchise.

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Franchising has been a great opportunity for people who want to own a business but don't have the expertise and time to make a system and learn everything from scratch. Entrepreneurs have lots of choices in franchising, but the most common is a food cart business. 

Below are some of the tips in getting a franchise.

  1. Make sure that what you will be getting won't have any competition in the market. Competition eats away your market share. This is the reason why I am hesitant to recommend getting a food cart business since there are so many food cart franchisors offering the same products and services.  
  2. Support from the company. A franchisor is responsible for training the franchisee and his staff. The franchisee, in turn, must make sure he and his staff must learn what the franchisor has taught. From time to time, the franchisor will send his own staff to monitor and supervise a franchisees staff.
  3. Constant marketing campaigns to ensure that the product or service will be on the customers' minds. Since a typical person will be bombarded with more than 5,000 ads on a typical day, the franchisor must seek creative ways to reach his target audience. This will ensure that the customers will go the franchisee's store. 
But getting a franchise is not a going to be a sure-shot success. It all still goes back to the franchisee. A franchisee must supervise and learn the business inside-out. He must conduct local store marketing campaigns and  ensure that the his staff are doing what they were trained to do.In the end, the franchisee is ultimately responsible for the success or not of his own store.