10 key considerations before purchasing a franchise
11th August 2023
If you are considering buying a franchise, it’s crucial to ensure that you make a prudent choice when selecting the franchise that suits you best. Conducting thorough research and gaining a clear understanding of your objectives are both essential steps. To provide valuable assistance in your decision-making journey, we’ve put together a list of 10 significant factors to take into account when deliberating the purchase of a franchise.
1. Know yourself
Perhaps the most crucial step, yet often overlooked, is understanding your own desires and motivations. Take a moment to reflect on what you truly want to achieve. Are you ready to invest your efforts in a new venture? Is becoming your own boss your real goal, or are you simply dissatisfied with your current job? It’s essential to gauge whether you’re comfortable working within established operating structures and adhering to franchise guidance.
Petpals requires all franchisees to represent our brand and adhere to our proven business model. However, we also wholeheartedly encourage you to explore your full potential and provide you with the freedom and flexibility to operate your business in a way that aligns your individual style and approach within our brand identity.
2. Do your research
Purchasing a franchise is a life-changing decision, and proceeding blindly or getting swept up in the hype is unwise. Research the industry, market conditions, and the franchise you’re considering. Each franchise offering will vary, make sure you find out what is included in their offering. Be sure to check their credentials. Are they members of the British Franchise Association (BFA)? Do they have membership to other reputable organisations that support ethical franchising?
3. How much can you afford to invest?
Depending on the type of franchise you are looking to purchase, investment amounts will vary hugely. If you don’t have the full capital to invest in a new franchise then there are other options available to you. We would recommend acquiring funding through a high-street bank or via a government-backed business loan. Franchisors have a good reputation with the high-street banks, which significantly increases the likelihood of them providing loans to franchise prospects, as opposed to perhaps individuals seeking to venture out on their own and start a business from scratch. Government backed business loans are also a great low-interest rate alternative if you do not have the capital to contribute towards your new venture.
At Petpals the cost of a new franchise is £15k + VAT. (See what this includes here.)
4. How much do you need to earn?
Be realistic about your income needs. Examine your current earnings and expenses to understand what you need to make the business viable. Incorporate this into your business plan and financial forecasts.
5. Assess your skills
Franchising offers support and training, allowing you to enter an industry even if you lack prior knowledge. However, it’s important to reflect on the skills and experience you can bring to the franchise. Identify areas where you may require additional support and training.
We’ve had individuals from all walks of life join Petpals, the comprehensive training you will receive means that no matter your previous roles or experiences you are given the tools needed to succeed. You will also receive on-going support from your very own franchise support manager as well as assistance from our in-house team of experts to ensure you receive the very best support. From digital marketing and social media, accountancy and book-keeping, to pet-care laws and legislation. Additionally, you’ll have access to our peer-to-peer online forum, where you can seek advice 365 days a year from any one of our franchisees across the network.
6. Define Your Business Objectives
Consider your aspirations for the business. Do you want more control over your time and decision-making? Are you looking for a hands-on role as an owner-operator, or do you prefer more free time? Different franchises offer varying degrees of choice, so choose one that aligns with your goals.
At Petpals we recommend our franchisees take a management-style approach by developing a quality team as early as possible allowing you to maintain a great work-life balance. Managing a capable team of pet carers will in turn give you more time to focus on growing and building your business.
7. Seek Family Support
Your decision to pursue a franchise could have implications for your entire family. It is crucial to ensure you have the backing of your loved ones. Additionally, embarking on a new business venture can be daunting, and having a support system at home can provide invaluable encouragement.
Many of our franchisees opt for a joint venture with their partner, a strategic move that allows them to leverage their individual skills and talents, thereby benefiting the entire business.
Whether you’re a sole operator or entering a joint venture, we always encourage you to seek support from family and friends. Seek their opinion and advice regarding your choice to venture into the realm of franchising.
8. Speak to other franchisees
When dealing with any franchisor, you should always be given plenty of resources and be offered to speak to the franchisees within their network. They should allow a ‘ask me anything’ approach, which gives you a chance to speak to the people within the network and allows an open, honest conversation with someone who can give you their personal insight into what it’s like to run a franchise.
9. Check the agreement
While you may not be able to negotiate changes to the standard franchise agreement, it’s crucial to fully comprehend its contents and your obligations. Before signing any documents, make sure you have a clear understanding of what you’re committing to. We highly recommend getting a franchise solicitor to go over your franchise agreement.
10. Don’t procrastinate
After extensive research and thoughtful contemplation, there comes a time when a decision must be made. While the research and planning phases are essential, progress towards implementation is equally vital. Some people put their decision off continually, and then later regret their missed opportunity. It can sometimes seem that now is never the right time, but with all things in life, procrastination is the enemy of success. Remember, success demands hard work and dedication, whether you choose franchising or an independent business venture.
In conclusion, both franchising and independent business ventures can lead to success, but each path requires careful consideration. Franchising offers a structured process with training, guidance and support, making it an appealing choice for many aspiring entrepreneurs. By taking the time to understand yourself, your finances, and your goals, you can make an informed decision and set yourself up for a rewarding entrepreneurial journey.