Deciding whether or not to go the franchise route depends on many factors, including your own willpower and resources as an entrepreneur. Here we go over the key areas of running a successful franchise, summed up in five steps:
1. Choosing your Franchise
Before you get down to business, you should first do thorough research on all the different franchise options you can try. Perhaps your expertise lies in a specific industry, like the service sector. Or maybe you want to cash in on the prestige and name recognition of a popular brand. If you’re still quite new to entrepreneurship or your startup capital is relatively low, you can start small by running your own food cart or kiosk franchise.
In doing this, you must orient yourself with all the rules and regulations that differentiate franchising from starting a business yourself. Your short- and long-term business decisions tend to be more conservative as a necessity, since you’re playing by the rules of an established chain instead of dictating them yourself.
2. Understanding your Market
This step is usually carried out alongside #1, but deserves singling out. In addition to back-end research, you should also have a clear (or at least workable) idea of your target audience. Is your intended location accessible by a large customer base? Are you filling a need or exploring a niche in your community? Are you aiming for an older or younger crowd? You can’t expect the franchise’s brand power alone to do the heavy lifting if the business itself is a poor fit for your location.
3. Building your Base
Next comes the hard part: laying down the groundwork for a fully-functional operation. Now that you have the basic guidelines for your franchise handed down to you, start assembling the framework for your business.
Whether you are signing a lease, hiring staff, or acquiring new equipment, maintain active involvement so you can spot problem areas before they happen. This is also the step where you build awareness of your business by marketing it to potential customers.
4. Protecting your Assets
Depending on the size and scale of your franchise, you should look into getting all the necessary protections for your business capital and assets. Conserve resources by migrating your business operations online, if only partially. Invest in topnotch security measures if you are located in a high-traffic area. Consider getting car insurance for your delivery vans, trucks, or other commercial vehicles. More importantly, make sure you treat your employees fairly, as they play a major role in your franchise’s success.
5. Keeping your Momentum
You’ve finally gotten your franchise off the ground, so now your objective is keeping it going. Far too many small businesses fizzle out because they fail to maintain the same level of quality they had while starting out. Keep your products and services consistently good for the benefit of your customers. Make an effort to foster loyalty and morale among your employees. One of the challenges of running a franchise is living up to the same positive reputation the main company has spent years building, meaning there are higher stakes if you mess up.
Entrepreneurs opt to take on the franchise track for all kinds of reasons. While some may regard it a safe investment with high returns, others may see it more as a learning experience for when they finally strike out on their own. Whatever your approach is, buying and running a franchise can be a great step for acquainting yourself with the ins and outs of making your own money.