Preparing to Buy a Franchise

If you're already committed to choosing a franchise opportunity, you'll need to prepare carefully before paying your first fee or agreeing to a royalty schedule. Weeding out the opportunities that don't include training or a proven business model will trim down your options, but there will still be dozens of good choices to consider. Use these three planning steps to pick a franchise that you can enjoy running for the rest of your career.

Examine the Industry

Don't try to add a fifth film processing retailer to a town where residents primarily use digital cameras. Do plenty of background research into the industry and your region's demand for the products or services before investing a dime. Invest in the professional opinion of a trustworthy analyst to determine if your store could still be turning a profit at the end of two or three decades of operation. Niche retailers can seem inviting during the peak of a trend, but safer options that are always in demand will age better over the years.

Discover Your Own Needs

What kind of hours do you want to work? How do you prefer to manage people? These kinds of questions are all important to answer when you are shopping around for a business model. Entrepreneurs with family commitments may not want to open a store that's open overnight since the owner will have to come in if an emergency keeps the other employees and managers from handling their duties. If you're not much of a salesperson, a model that relies on advertising instead is a better choice than a direct B2B franchise.

Read Up On the Parent Company

It's stressful to discover your franchiser doesn't provide any hands on training or local support after you've signed a contract. Look out for companies making big claims without any specifics. Search for complaints from people who failed to succeed with the system, but be aware that every brand has its detractors. Take warnings from advisory councils or signs of litigation more seriously than anonymous reviews listed online. If you can, talk with current owners working within the system to determine how satisfied they are with their choice.