In today’s economy the franchise business opportunity is a popular choice – as it offers entrepreneurs an opportunity to own a business with a ready-made system for success. Owning your own business is not a decision to be made lightly. Even a good franchise business opportunity with a good manager can fail, so consider your decision carefully.
What Are Your Resources?
Small business franchises aren’t handed out like free samples at the grocery store. You must determine what you bring to the table and the first thing to consider is money. How much can you afford to invest in a franchise business opportunity? Consider your current assets as well as other sources of financing such as small business loans.
What else do you bring to your business? Are you good with people? With figures? What is your skill set? This will affect decisions such as industries to investigate and whether you would be more interested in a traditional storefront operation or a mobile consulting business that you could run from your home.
Here’s a harder question: What are your weaknesses? Don’t kid yourself here; it will just hurt you later. If you prefer working alone then investigating a franchise business opportunity such as a restaurant where you will have to hire a lot of employees isn’t going to be the best small business franchise for you.
Narrow Down the Choices
If you look at a list of small business franchises available it can be overwhelming. Where do you begin? With this personal evaluation completed you can start crossing of certain industry segments. You aren’t looking at individual opportunities here, just broad categories. You might cross off computer repair shops but be interested in coffee houses.
Consider which segments are likely to be strong even if the economy continues to weaken. There are a number of industries such as fast food that do well in recessions and you would be well advised to lean towards those kinds of opportunities.
Once you have a few interesting industries on your list, start looking at individual opportunities. Focus on what each one has to offer, whether they have territories in your area, and whether they seem to match your own personal profile.
Focus On Your Short List
Now that you narrowed it down to a handful of prime candidates, contact each of them for further information. You will need to complete a questionnaire so they can ensure you meet their criteria for potential franchisees. Assuming you pass, they will send you more information including the FTC-mandated Franchisor Disclosure Document (FDD).
Study the FDD carefully as it will contain critical information from a history of the executives to details of company litigation. Contact the franchise for more information and get all of your questions answered before considering investing. They will be evaluating you as well so be prepared to answer a few questions.
When you have completed these steps you should have found the ideal small business franchise for you.