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Business ownership isn’t right for everyone. Franchises are no exception. While they provide wonderful benefits that make them preferable to go-it-alone start-ups, there are plenty of reasons to delay or avoid starting a franchise. Here are four reasons to reconsider—at least temporarily.
1. You don’t have enough money (yet). Some franchises can be started for small investments. But there are other considerations, including your plan past the opening date. With build-outs, delays happen. In addition, overruns and overages on materials may surprise you, if you don't plan well.
Also, you will need to cover your own living expenses while you are in your start-up phase. It's advisable to have 6-12 months of operating expenses available to you for the period until the business turns a consistent profit. If you're worried now about not having enough money, aka being undercapitalized, delay your franchise ownership plan and ensure you are well funded before you open the doors. Consider your financial security carefully to better ensure the long-term health of your franchise and personal finances. Act when the time and money are right.
2. You’re a maverick. Mavericks are non-conformers whose ideas and drive often lead to success because they are bold and different. This can be a wonderful trait for entrepreneurs. You see possibility and you go for it. But, if this describes you, a franchise might not be suitable for your style.
Franchise brands are successful because they are known entities with pre-packaged logos, marketing, products, and services. If you want to revolutionize an industry, franchising might not be for you. The guidelines may end up feeling constricting. It doesn’t mean you won’t be successful in the franchising world, though. Perhaps you will develop a service or product that will become its own franchise.
3. You aren’t focused. This isn't a reference to attention issues. Can you be disciplined and passionate about moving forward with a franchise? Franchises, like any new business, require a time investment and focus on best practices that lead to success. Even if the plan is to eventually work more limited hours, a new franchise will not succeed if it’s only grown in your spare time—particularly in the beginning.
The necessary focus also applies to the different parts of the franchise. Maybe you see a great way to market a particular part of your business, but it may not be as valuable to you as you are starting out and needs to be put on the back burner for a while. If you get caught up with one idea rather than overall success, you will probably lose valuable time working on the wrong project.
4. You’re not sleeping at night. Any new venture is exciting and a bit nerve-wracking, but if you're not sleeping at night, something is amiss. Maybe you aren’t asking for enough of the details, or you have limited legal understanding of agreements. Figure out what is bothering you so you can (1) correct the issue or (2) realize that the issue is incompatible with your sleep. In the latter situation, you probably will never be at peace opening a franchise that is keeping you awake at night.
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Some people are just better off working for someone else and not running their own business. Some people aren't suited to work under the structure of a franchise business. A franchise offers reliable opportunities for those who are well-prepared financially and who have evaluated their own personal styles enough to understand when something doesn't feel right for them. Be honest about your desires and expectations so that you recognize a well-suited (or perhaps an incompatible) franchise match.
Anne Daniells is a co-owner of Enterprising Solutions, a professional services firm specializing in corporate communication and financial improvement for businesses where she shares decades of corporate and entrepreneurial experience—including franchise ownership—in her writings on business culture. She has authored hundreds of articles for publications including AllBusiness.com, TweakYourBiz.com, and MSN.com. Reach out via her website for more on where corporate culture, communication, and human architecture collide.