Joel Libava
When most people think of this 4-letter word, they usually think about how the word can affect them. It’s completely normal.
But, the word I’m about to share with you (when there’s an action associated with it) can affect more than just the person who has decided to fully embrace it…fully experience it. It’s a 4-letter word for prospective franchisees. It’s a word they need to learn about.
The word I’m referring to was also embraced by another person-it’s really the reason that you’re where you’re at now…or soon will be.
I’ll explain.
A 4-Letter Word For Prospective Franchisees
When someone contacts me for franchise advice, I can usually sense some apprehension on their part. They’re concerned about what they may be about to do. I don’t blame them. But there’s a reason they’re coming to me.
People come to me for advice and guidance because they’re trying to lower their risk.
That’s the 4-letter word I’m referring to.
And, I’m good at helping people get more comfortable with it.
But, it’s not like it’s a dirty word. It’s just a scary one.
Ways To Lower Franchise Ownership Risk
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- Choose wisely
- Do great franchise research
- Have enough money to last you through the first year
- Create a business plan
- Use a franchise attorney
Becoming the owner of a business-any type of business, is risky. Don’t let anyone tell you otherwise. You just need to get comfortable with the idea of risk. Not 100% comfortable. Just more comfortable. Just don’t fall for some of the spin that’s out there concerning franchise risk.
Fact: It is not less risky to start a franchise as opposed to starting an independent business. Don’t believe everything you read about franchises being less risky.
There’s Risk On The Other Side Too
There’s also risk involved in turning an independent business into a franchise business. It’s real risky. One reason that it’s risky to franchise a business is that there’s no guarantee of success.
Another reason that it can be risky to franchise a business has to do with the person or the firm that’s actually doing the necessary work needed to put an entire franchise package together. Some franchise development firms aren’t that good.
Plus, not every business is right for franchising.
If someone wants to turn their business into a franchise business, the first thing they’ll need to do is get comfortable with the risk involved in setting up a franchise. The next thing they’ll need to get comfortable with is the money.
When people call me for information on how they can franchise their business (I don’t do franchise development work-but I make referrals to people that do) I tell them point blank that they should figure on spending around $100,000 to do it right. All the things they’ll need to do…and all the things they’ll need to have in place can add up really fast.
For example, they’ll need to create operations manual. They’ll need to purchase the right kind of technology. They’ll need to have a franchise attorney draw up all the legal documents. A training program will need to be designed for franchisees. Plus, they’ll be lots of marketing expenses to launch the new franchise.
There is definitely risk involved in setting up a franchise business.
But, without risk, a lot of things we enjoy today wouldn’t be available to use.
Like
- Electricity
- Fire
- Automobiles
- Computers
- The internet
- Solar power
A lot of people before us took risks.
Now it’s your turn. You’re the one that has to decide when (and if) you’re ready to take one.
Just know that there are many ways to lower your risk these days.
If you’re looking to become your own boss, and feel that a franchise business could be the way to go, let’s talk. I have dozens of ways for you to lower your risk if you decide to become a franchise owner.
Don’t fear risk. Learn how to get more comfortable with it.
Be at one with risk. So you can move forward.
Contact me if you want to learn how I can help you lower your risk.
About the Author
Joel Libava is The Franchise King® — an independent franchise advisor with 25+ years in the industry, two published books on franchising, and his writing has been featured in The New York Times, Forbes, CNBC, Entrepreneur® Magazine and others. In addition, he wrote exclusively for the U.S. Small Business Administration blog for eight years. He doesn't sell franchises. Instead, Joel helps you figure out if franchise ownership is actually right for you — and if it is, teaches you his powerful, proven-to-work franchise research techniques, so you can make a smart, informed decision on a franchise to own and be your own boss.
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