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What makes a good franchise to buy? Or, put a different way: What things do all good franchise opportunities have in common?
As you look at franchises to buy (in places such as here), see if the ones you choose to learn more about have the elements listed below (including an important one you may not have thought about).
Because if they do, you may be looking at some wonderful opportunities for you to be your own boss.
3 Elements of Good Franchise Opportunities
Good franchises don't just have three things in common, but the trio that follow is a good checklist as you go through your search.
1. A Superior Product or Service Offering
It is understood (even though I’m saying it), that businesses offering excellent products and/or services tend to get a lot of business, even at higher price points.
For example, let’s say you own a lawn care franchise. A business that allows you to easily show off your work. In this case, the lush, green lawn you helped create. Experience tells me there’s an excellent chance you’ll get some new business when your customer’s neighbors see your work, even if your customer doesn't explicitly tell the neighbor about who provided the service.
It should be noted that franchises and other small businesses selling their wares at low prices plays into purchasing decisions too. However, quality still factors in.
For example, when a pizza franchise does a Buy One Get One Free (BOGO) promotion, business can heat up in a hurry. And so can profits, especially if the franchisee is keeping her expenses low. That said, in this case, even with a low price the product (pizza) still needs to be good to keep business.
2. Professional, Caring Employees at Headquarters
What you’re looking for here is a company that cares about your success as a franchisee. A franchisor that will provide excellent support when you need it.
But there’s just one problem: How are you supposed to know if the team at franchise headquarters is supportive until you become a franchise owner? There are two ways.
The first way is by asking franchisees who are in business right now. When you get in touch with current franchisees of system during your due diligence process, here is a question to mix in to your conversation “Are the folks at headquarters providing the support you need-when you need it?” Then ask the franchisees you talk to for specific issues that were solved by the support staff.
The second thing you need to do is visit the franchise company headquarters in-person. Good news for you is that this visit is common in the franchise buying process.
You need to meet the people who will be supporting you and your new business face-to-face. While there, answer the following questions to yourself: Are they nice? Do they seem like they care? Do you feel you can call them anytime for direction and support?
It’s important to trust your gut here. Your intuition. At the end of the visit, honestly confirm to yourself that you genuinely feel the franchise support team is going to be there for you.
3. Great Technology Practices
Today’s franchisors have access to the best business technology available. The question is, are they using it optimally?
For instance, here's a question to ask your franchise representative: “Do you have an email marketing system in place for franchisees, along with a proven way to collect customer emails?”
Although this seems basic, some franchisors are better at this than others. Get some specifics. Ask how successful their email marketing initiatives are. Remember, part of what you’re supposed to get when you’re part of a franchise system is proven marketing strategies. And that should include email marketing, as it offers a huge bang for the buck.
Another thing you need to find out about is internet security.
According to my friend, Kevin Goodman, who is the Managing Director of BlueBridge Networks, “A cyber-attack can disable the franchisor’s website, email server, or other critical systems, making it difficult or impossible to do business.”
If not properly protected, the company website, and your site (if they created a local website for your business), could go down.
So, ask someone, preferably in the IT department at franchise company headquarters, if they have specific protocols in place if the company’s web servers get hit with a cyber-attack.
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To wrap things up, in most cases, today’s franchisors have high-quality products, excellent business systems, and terrific technology to your business humming along.
But you will not know for sure unless you ask.
The Franchise King®, Joel Libava, is a top franchise expert. He’s written over 2,000 different articles on franchise ownership and personally consults with people who are looking to buy a profitable franchise. Go here to find out how The Franchise King® can help you become your own boss.