Franchising is considered one of the most successful business mechanism in the modern world. It is said that franchising increases a business’ success rate by 80% or more, as it is cemented on the learnings and triumphs of other business pioneers, making it an ideal option for the entrepreneur looking for a smart investment. The challenge lies however in the process of identifying the correct business opportunity to invest in. With so many options available, making the right choices can be a time consuming one. Fortunately, events such as the International Franchise Expo (IFE) have been put in place to provide interested entrepreneurs with as much information on the various opportunities as possible – all in one place.
The issue of effective decision making does, however, still persist when visiting such exhibitions, as potential franchisees can easily be overloaded with information, which can cause even more uncertainty. According to Managing Executive of The Fish & Chip Co, Jan de Beer, the key to effective ‘shopping’ at a franchising exhibition, lies in the strategising before, during and after the event. He shares the following pointers to ensure any entrepreneur is prepared.
Before the IFE:
- Before you attend, have an understanding of which franchising industries are most relevant to you. Industries can range from fast food to dry cleaning, and it is important to have an idea of which would be the best fit, based on your interests and knowledge base.
- Once you have an understanding of which industry you want to move into, do some research on the different brands that are available and short list the ones that are most relevant to visit at the exhibition.
- Know what information you need to have from each exhibitor. It is advisable to compile a list of questions to ask in order to gain as much understanding from your encounter with them as possible.
At the IFE:
- Collect information that is of interest to you by asking the questions on your list. Take down the contact details of the most relevant person to speak to so that you can contact them should you have more questions.
- Look for networking opportunities where you can build on your knowledge base. Not only will you be able to learn more about the industry, but you will also be able to build some vital contacts that could open doors if you build on a relationship with them.
- Don’t be fooled by sales talk. Most exhibitors will know how to present their product in the best possible light and will work to influence you in just the right way. Stick to your questions and obtain the facts you need without being swayed by sales talk.
After the IFE:
- Your research should not stop after the exhibit. Make direct contact with the franchise and ask them more questions, such as:
- How long has the franchisor been in business?
- How many franchise outlets currently exist?
- How much is the initial franchise fee and any additional start-up costs?
- What other monthly and annual costs can be expected?
- What management, technical, and ongoing assistance does the franchisor offer?
- What are their company values?
- What are their goals and ambitions?
- Request to receive the disclosure document as this contains important information about the franchise system outlining as much detail as possible.
- It is also recommended that an entrepreneur obtain legal advice from a qualified franchise attorney, as certain items in a franchise agreement may be negotiable. This agreement needs to be evaluated and discussed, in order to identify potential changes that could occur.
Buying into a franchise entails a significant investment and it is imperative that franchisees seek all the needed guidance from professionals in the industry to make informed decisions.
Opinion piece shared by PR Worx.