Hayley Forder, Franchise & Marketing Executive at Signs Express HQ offers her advice for setting up your own business and selection of the right franchise opportunity. x
Start a business for yourself, be self employed, become an agent or start a franchise for a company? Deciding on the vast range of business opportunities can be difficult with so many different factors to consider, so it’s always best to take your time and do your research.
So let’s start with the question, what is franchising? It is a licence to use intellectual property from one party (franchisor) to another party (franchisee) with a predetermined series of ongoing commitments between both parties.
There are 3 different types of franchising:
- Manufacturing or product franchise
- Distribution or co-operative
- Business format or system franchise
It’s always a good idea to evaluate your objectives for running your own business, look at your strengths to work out which one would be the best for you. Franchising can change your life for the better and unfortunately at times sometimes for the worst, however the worst usually happens when people have not considered the factors such as lifestyle, money, and above all else location. Like they say “the worst house in a good neighbourhood is better than the best house in a bad neighbourhood”.
Here at Signs Express we feel that there are 6 different steps to selecting the right franchise, so let’s begin…
STEP 1: Investment level
Firstly you should speak to the banks and accountants to know the reality of your finance situation. It’s always best to define your investment level before you chose a franchise, don’t try and make it fit if you can’t afford it, and always thoroughly research your options. Banks are always happy to help when franchising is involved, the main reason being that a franchise is a tried, tested and proven business model. They can give you advice on a business plan and also ideas on how to raise the finance.
STEP 2: Suitability
After looking at your finances it’s always a good idea to take a look closer to home and ask yourself if franchising really is the best thing for you:
- Do you have the desire to work hard?
- Are you able to make a long term commitment?
- Can you follow and adapt to the franchisor system?
STEP 3: Industry
So this is where it gets exciting! Now is the time to look at your chosen industry, research it and the current market place. It’s always best to avoid “fad” industries, don’t forget to take a look at the boom/bust cycles it may have had over the years.
When choosing a franchise, the franchisor will train you so don’t be concerned if you don’t have experience – most franchise owners come from completely different backgrounds.
Ask questions like:
- Does it have a proven market place?
- Does it interest you?
- Are there opportunities for growth?
- Who are the main competitors?
- Will it suit my lifestyle?
STEP 4: Seek advice
So now it comes down to the three remaining pieces of advice:
- Commercial – always make sure you have spoken to the franchisees/franchisor to make sure you understand what this franchise is all about. It’s always a good idea to speak to the BFA and other industry bodies; they have been in the business a long time and will be able to give you information on the franchise opportunity you’re looking to buy.
- Financial – Accountants, you need to make sure that you not only have enough money for the franchise but also enough to give you working capital.
- Legal – make sure you speak to your franchise solicitor and understand all terms of the franchise agreement.
STEP 5: Compare the best
Would you buy the first car you saw? Possibly, but more than likely you would shop around to find a car that best suits all your needs. This is the same principle as looking for a franchise; it may be that the first franchise is the best suited to yourself. However it’s always best to see what other companies in the sector you have chosen offer. Its good to ask questions, and to also visit the head office to get a feel for the company and the support structures in place.
STEP 6: Decision time
Its decision time, you’ve done your research and asked the questions but don’t sign if your not ready, you can always start the six steps again. Make sure you are 100% ready and if and when you decide to become a franchisee remember Rome wasn’t built in a day, but your franchisor will be with you every step of the way.
Signs Express is the UK and Ireland’s leading signs and graphics franchise, established for over 20 years with a network of more than 75 franchisees. To find out about Signs Express franchise opportunities call 0800 731 2255 or visit http://franchise.signsexpress.co.uk/