Get Cashin 2009

When investigating a franchise opportunity, many people make several very basic mistakes, based on common assumptions or misconceptions. If you are looking into this possibility, whether you have found a possible franchise or have not yet even started looking, it may be wise to spend a little while asking yourself some basic, but very important questions before deciding just how appropriate such a venture will be for you.

If you have been studying franchises, then one of the things you may have come across is the advice that you should never be amongst the first people to join. The reason for this is supposed to be that if a franchise is new, then it is untried and untested, and therefore represents more of a risk. It is often said to be better to wait until the franchise has gained popularity, expanded and taken on many more franchise buyers before deciding to join such a venture.

This assumption although right most of the times can sometimes be false! Firstly, if a franchise is new, it does not necessarily imply that it is not worth joining. New ideas can have many benefits - being first into the marketplace with a new product, a new service or a new concept is very powerful indeed.

Also, it is worth asking how much support you will receive from a franchise business which has already grown rapidly, compared to one which is only just beginning. If you're looking at getting a lot of support and advice, surely you are more likely to receive better and more personal support if you are the first, or one of the first, to join such a business?

It is also worth considering the assumption that large franchises are better than smaller ones. If a franchise has already grown to the point where it is nearing market saturation, then clearly it would be unwise to attempt to compete within such a business. If a franchise has expanded, and taken on too many franchise holders, then there is likely to be greater competition between those individuals who have bought in to the opportunity. If there are local franchise holders, then is it wise to put yourself up against them?

These questions are particularly worth contemplating if you are new to the idea of franchises, and even more critical if you are new to the whole idea of working for yourself or running your own business. If this is new territory for you then not only will you not want to be thrust into a market where there is massive and experienced competition, but you will need to be within a franchise arrangement that offers you excellent support, especially in the early years.

If you have started to look about at franchises, and have read some of the material on offer, including business plans, agreements, contractual requirements and advice on running the business, then you may have come to one conclusion. You have realised that most franchises offer a very great deal of well thought out business advice. You may have found a franchise but decided that you will only follow some of the guidelines, forging your own way in new directions once you get started.

This can be dangerous for one of two reasons. If you decide to run the business your own way, are you really prepared for the consequences? Have you enough business experience to be able to go against the recommendations of headquarters that clearly already have more business experience within this particular sector? The other issue to give serious consideration to is whether you may be breaking a contractual agreement by diverging from the specified business path or method.

Franchise contracts can be quite specific, and it is worth bearing this in mind. If you are not fully happy with every aspect of the franchise agreement, then it may be better to walk away than to assume you will be able to successfully deviate from it. There are many franchises available today, and if one doesn't seem to quite fit, it may be more appropriate to look elsewhere.

However, if you are regularly finding that you are critical of almost every business proposal and franchising agreement available, then ask yourself two questions: are you being too unrealistic in your expectations of what franchising can offer? Should you instead consider setting up your own business so that you have the freedom to run things the way you really feel best? Either way there may be the need to be critical with yourself, asking some deep questions and being thoroughly honest about your expectations. Managing a franchise is not easy, but if you do choose the right one then the rewards can be huge.

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