It sounds like a great deal. Buy a franchise: work for yourself but enjoy the stability of an established brand and the support from a mature corporate structure. Best of both worlds, right?
Not so fast. You can definitely succeed and prosper as a franchise owner, but that doesn’t mean it’s a cakewalk.
You Need To Go All In
If you going to buy the franchise, well, you need the money. Some franchisers also require franchise owners to meet a certain net worth before they’ll turn over the brand. You’re going to have to heavily invest in this business yourself.
Odds are you’re going to be working long days, every day of the week to get it going. You’ll need to hire staff and ensure they’re trained. You’re the one they’ll call if something goes wrong and you’re not already sweating in the kitchen. And it’ll be your money on the line if it doesn’t work out.
You Can’t Make The Brand Yours
With the safety of the brand comes the restriction that you have to adhere to it. You can’t decide to throw a new item on the menu because you think it’ll sell. You can’t pull one off that doesn’t. There might be some level of control over the details of a local advertisement, but probably not a lot. The logo, messaging, campaigns? They’re all set by the corporate office.
Having said that, you might appreciate that having it out of your hands frees up your time to focus on more fruitful work.
You’re Geographically Locked In
With multiple franchise owners in towns and cities come territorial restrictions. You won’t be able to target people outside of your immediate area, so you’d better be convinced the location’s going to work. When you buy a franchise, you can’t just take it across town on a whim. It is where it is, and you have to find a way to live with that and make it profitable.
Getting In Can Be Complicated
Besides the financial angle, getting through the approval process is a tough slog. There are going to be contracts and agreements you need to read carefully, interpret, evaluate — and perhaps —push back on. Understanding the terms and what they mean to you is a complex task best suited to a lawyer, so you’ll need to reach out and acquire trustworthy legal assistance.
Remember, they’re figuring out if it makes sense for them to take a chance on you, but you ought to be doing the same with taking a chance on them.
Getting Out Is No Easier
Franchise agreements come up for renewal, and if the timing’s good for you, that could be a convenient time to get out. It’s still likely a messy, lengthy process to dispose of the franchise or transfer to a new owner. But whether at renewal time or not, you need to make sure you have an exit strategy. If the franchise is not as profitable as you’d hoped, you may not be able to afford to make it to the finish line. Understanding what your options are, again, is a task for expert legal help.
If you’re ready to take the plunge, but need that legal counsel, Juriscorp’s team is set to get you up and running with terms that work for you. You may also wish to read about further legal issues around purchasing a franchise.