In part 1 of this 3-Part series on Money-Making Franchise Opportunities, I shared a few different ways to find franchises.
Go here if you haven’t read Part 1 yet. If you’ve already hit the franchise opportunity websites I recommended in Part 1, great. Now, I’m going to show you a few ways you can choose money-making franchises.
Do you have any idea how many different franchise opportunities there are?
Most of us (in franchising) put the number of franchise opportunities available at 3,000-give or take a hundred.
That’s a lot of franchises to go through. Good thing you’ve been following my advice on how to whittle the choices-your choices down to a manageable level. But, still…
You’re human: It’s easy to get overwhelmed by the number of franchise opportunities there are. Even with the how-to tips I share. So, what should you do?
That’s one idea.
Money-Making Franchise Opportunities Part 2: Choosing
If meditating isn’t your thing-I understand.
But, all kidding aside, choosing the right franchise-choosing a money-making franchise opportunity probably won’t be easy. Armed with the right information-it should be easier. But still…
You’re going to have to know what you’re doing. You’re going to have to find a way to avoid the duds* in franchising.
*Franchise Dud– A franchise opportunity that has very few money-making franchisees…and one that you’ll never make money owning unless you get extremely lucky. Want one of those?
That’s why it’s so important to learn all you can about the franchise opportunities you’re interested in. You could end up investing $150,000, $250,000, or more-on your endeavor. Your choice in a franchise has to be right.
No pressure there.
Making Good Choices
I’m going to show you how to choose-or at least how to start making good choices in a franchise.
The first way is pretty powerful, if you can pull it off. If you can’t, fine. Just use a different way.
A Question: Wouldn’t it be great if you could get inside the head of a franchise CEO?
You’d be able to find out their thinking. You’d be able to see their vision for the future.
But you can’t. You can, however, do some research into what the CEO of the franchise organization you’re thinking of becoming part of has written about or has said. Check this out.
A few hours ago, I happened to glance at a great book written by Paul Facella. Paul was the Regional Vice President of McDonald’s under this man.
In the book, Paul tells a story about Fred Turner’s courage. (Fred Turner replaced Ray Kroc as the chairman and CEO of McDonald’s in 1977, and held the position for a number of years.)
Fred Turner was presented with a huge opportunity-one potentially worth hundreds of millions of dollars, to open and operate McDonald’s restaurants on each and every U.S. Army base. Sounds great, right? But here’s the thing…
Turner was said to be very troubled by the deal…by how it was structured.
The Deal Wouldn’t Have Involved Franchisees. Instead, the U.S. Army would operate the restaurants. They would essentially be the franchisee.
Turner walked away from the deal- which was a very courageous thing to do. He felt that up to then, McDonald’s had individuals-franchisees, owning and operating the restaurants. The system was based on a licensing model…a franchise model, and Turner refused to compromise what was a great system.
You should read Paul Facella’s book. There’s a lot of wisdom in it…along with a few interesting facts about Ray Kroc.
(Click the book)
You just got a peek inside the head of one of the greatest franchise executives that ever lived: Fred Turner. A man who obviously cared more about the franchise model than signing on to a potential multi-million dollar partnership that would not include franchisees. I’d be willing to wager a lot of money that Turner also wanted to do everything he could to make sure his franchisees were profitable. Real profitable. That they were making money.
The proof is in the pudding; there were a lot of (McDonald’s) millionaire franchisees created in the 70’s and 80’s.
Tip: Find a franchise executive like Fred Turner. Because, if you can, you’ve found yourself a winner. You’ve found a franchise opportunity that has the potential-serious potential, to be a money-making franchise opportunity.
What? You don’t think they’re out there?
You don’t think there are franchise opportunities around where you can make money-good money, as a franchisee?
Of course there are.
As a matter of fact, if you searched for franchise opportunities the way I suggested in Part 1 of this series, you may have already found them.
Another Way To Choose Money-Making Franchise Opportunities
Check growth trends.
Specifically, you need to hone in on growth trends for the sector of franchising that the franchise opportunities you’re interested in are a part of.
For example, let’s say you feel (so far) that becoming the owner of a hair care franchise-a multi-unit owner as a matter of fact, could be a good fit for you. If that’s the case, all you have to do is type “retail hair salon trends” in Google or Yahoo, and see what comes up.
This- Beauty Salon Business Overview & Trends
It’s an entire report on the trends taking place in the beauty salon business. Will it show you exactly what you need to know? Maybe. There’s only one to find out.
Read the report and find out. If the report doesn’t show you enough information, do another search. I’m confident you’ll find what you need to know on practically any sector you’re investigating.
If the industry trends-or the trends within a specific sector of an industry are heading up, you may be onto something.
If the trend line is flat-or down, keep an open mind, but start thinking of other ideas.
Tip: Search for online forums that are centered around the industry or sector you’re starting to investigate. If you find one or two, you may be able to join the forum, or at least get a feel of what’s being said. It’s worth a shot.
Use An Outsider To Help You Choose
Did you know that there are actually professional franchise matchmakers that can help you choose a franchise? Well…
There are: They’re called franchise brokers. Or, franchise consultants. Or-and this is really pushing it, franchise coaches.
Before you continue, read this article about franchise coaches so you have an understanding of what it is they do.
If you’d like to get some help choosing a franchise, using a matchmaker-a broker, consultant, or coach, is one way to go.
If you do go with a franchise broker, make sure you understand their business model.
The Federal Trade Commission (FTC) wrote about brokers in their very popular Consumer’s Guide To Buying A Franchise. Here’s an excerpt.
Typically, a broker reviews the amount of money you have to invest and then directs you to opportunities that match your interests and resources. A broker also may help you finish applications and the paperwork to complete the sale. Brokers often work for franchisors, and are paid only if a sale is made.
Some franchise brokers may claim to be able to match you with “the perfect opportunity” because they represent a wide range of business sellers. That may be true — or not.
Ask how many franchisors the broker represents. A broker who represents only a few franchisors will give you limited suggestions.
Some franchise brokers may claim they will suggest only those franchises that meet certain standards. You may think this means that your risk is limited because the broker weeds out poor investments. In fact, some brokers represent any franchisor willing to pay them a commission for a sale. A broker who does that might direct you to a franchisor that is failing or doesn’t have a strong history.
Read the rest of the section on franchise brokers, along with other important information* on buying a franchise, on the FTC.gov website.
*The FTC updated their guide this year, and a representative contacted me to make sure I spread the word.
If you want to own a money-making franchise…take my new online franchise course. It’s the ultimate course on buying a profitable franchise.
3 Ways To Choose A Franchise
You now have 3 ways-3 very different ways to choose a money-making franchise…or at least 3 ways that will start you on your path to potential profitability as the owner of a franchise business.
But the most important way to find out if you’re looking at money-making franchise opportunities is to do great research. Research you don’t know how to do. (Yet
Don’t worry: I’m going to teach you how to do great franchise research.
Tip: Great franchise research will enable you to find out if the franchises you’re interested in have a great leader at the helm. A leader who’s focused on the franchisees. A leader who’s focused on franchisee profitability. And, a lot more, as you’ll soon find our.
That’s because I’ll be sharing some of my top franchise research tips in Part 3 of this series. You won’t want to miss them.
Especially if you want to be a money-making franchise owner.
Improve Your Franchise IQ With These Recommended Articles:
How to Use a Franchise Opportunity Website
The 10 Commandments of Franchise Research
What You Need To Know About Franchise Consultants/Brokers