Get Cashin 2009

You have finally decided that the time is right to buy a franchise business. You have already researched the pros and cons of buying a franchise versus starting your own business. How do you make sure that you choose the right one for you?

A decent franchise will not only be a good idea, it will also be an idea that is under constant development. Find a franchisor that is committed to improving and developing the concept so that it can keep pace with their fast moving competitors.

Before committing to any franchise ask the following key questions:

What training is included within the initial franchise fee? Does the franchise provide you with a comprehensive operator's manual? Do they have training videos that you can watch in the comfort of your own home?

Does the franchisor offer proper telephone support? Can you call them out with office hours in an emergency? Do they have a decent internet forum where you can chat with other franchisees?

Is the product or service a good idea? Do you think you will be able to market it? Is there decent demand out there in your local marketplace? What are the unique selling points compared to their closest competitor? Will you get an exclusive territory?

Will the business fit in with your lifestyle? Can you work the hours required within the business? Who will cover for you when you go on holiday? Will you enjoy managing the business? Never start any business just because of money. Find a franchise that you will enjoy operating and then you will not dread going to work every day.

Bear in mind that a franchise is like any other business in that it will take time to start making money. How will you cope in the meantime? Do you have enough slush funds to keep paying the bills until your new business starts generating an income?

Speak to your accountant and get him to check out the figures for you. It is always a good idea to get a second expert opinion and who better than somebody that looks at facts and figures all day, every day? At the same time, ask your bank manager what he thinks of the idea. If your bank manager and your accountant both think it is a good idea, it probably is!

How are the royalty payments calculated? When and how often do you have to pay them? Are they within the normal range or are they excessive? Are there any other ongoing payments you need to make? Many franchises charge a marketing levy for national advertising so make sure you check this out.

Read your franchise agreement carefully before you put pen to paper. Is it a fair agreement? Does it protect your rights just as much as the franchisors? A proper agreement will clearly spell out the franchisors obligations to you.

A franchise at the end of the day will only reward you if you put effort in. No business runs by itself. You should always be able to count on the franchisor for full support and guidance but at the end of the day, you will have to work within the business and grow the sales.

Do you think you have what it takes to manage your own business?