2. There are literally thousands of lists of “Top
Franchises to Buy” on the Internet, and all of
them have some kind of logic behind them...
3. The problem is that “some kind of logic”
isn’t necessarily your kind of logic.
4. This is a guide to understanding
your logic and learning how to
apply it to your personal
‘Top Franchises to Buy” list
5. Step 0: Start With What You Love
The first thing you need to do is cross off 95% of the
potential franchises in the world by crossing off anything
and everything you don’t care deeply about. The single
most important indicator of success among people who
actually sign a franchise deal is that they are dedicated to
the idea they sign onto. If you don’t start with passion,
you’ll never end with a profit.
6. Step 1: Understand Your Limitations
Every franchise has certain requirements
— some more than others — and your
personal ‘Top Franchises’ list is going to have
to automatically cross off any that you
simply can’t meet the requirements of.
7. The most common forms of requirements are:
● Funding. Far and away the most common requirement for
people that want to buy into a franchise. Franchises require
a lot of money to start up, and then even more to keep
afloat until you start turning a profit. If you don’t have the
financial backing, you don’t have a franchise, period.
8. ● Net Worth. Some franchisers additionally require
you to have a level of personal net worth before
they’ll consider you — $250,000 in semi-liquid
assets is a fairly common requirement. Again, if you
don’t have it, you’re out of luck.
9. ● Education. More rarely, but still known to happen, a
franchiser might require you to have a certain level of
education or even a certain specific major, minor, or
degree in order to consider you a viable candidate.
10. ● Legal. Finally, you have the requirements that aren’t
inflicted by the franchiser, but by the government. If you
can’t, for whatever reason, get all of the licenses,
permits, and so on, you’re going to have to look at a
different franchise opportunity.
11. Step 2: Can You Turn A Profit
Once you’ve crossed off all of the franchises that are
“hard nos” because of Step 1, it’s time for the hard work:
crossing off any and all of the franchises that don’t have
a business plan that shows you turning a solid profit
sometime between 15 and 30 months out...
12. Any longer than that, and you risk a ‘black swan’
event ruining you before you start getting your feet
under you; any shorter than that, and you have to ask
yourself if you wouldn’t be better off establishing
yourself as a competitor to that franchise rather than
becoming a part of it.
13. Similarly, if the profitability isn’t significant after a few
years, you’re running the risk of a small economic downturn
or a shift in the market wiping out your profit entirely in the
first place.
14. Before you move on, do all the work you need to in order
to cross off any franchises on your list that aren’t going to be
reliably, decently profitable within a reasonable timeframe.
15. Step 3: Will They Help You When You Need It
Every business owner needs help somewhere along
the way — franchise owners should be able to expect it
from their franchiser.
16. But not all franchisers play ball, so before you make any
decisions, you need to cross off one last group of
franchisers: those who fail to offer meaningful assistance in
each of these four key areas:
● Management
● Location
● Budgeting and Cost Control
● Key Business Activity
17. ● Management: the tools you need to recruit, train, and manage
employees.
● Location: assistance in finding and acquiring the right place for your
franchise.
● Budgeting and Cost Control: the structure you need to stay afloat
until you turn a profit.
● Key Business Activity: whatever your franchise actually does to turn a
profit, there should be an ample amount of help available to ensure
you can do it as well as the home office knows how.
18. Congratulations! Now that you have all of those
franchises crossed off, arrange the rest according to
your personal ROI/Job Satisfaction needs, and start
applying.
19. When you do apply be ready to deal with the
company’s franchise recruiter. This is the person
whose job is to “sell” you on the benefits of buying into
that particular brand.
20. Another way to go is to work with a franchise broker. Brokers
are under contract with several hundred of the top regional and
national franchise brands and they are not “captive” to any one
particular company. This frees them up to do all the legwork for
you and help you find your top franchise to buy – based on your
passion, skills and budget.
For more info, visit
http://franchisecity.net
