Pip Wilkins, CEO of the British Franchise Association, gives her top points you should consider. The following article appeared in the May 2020 issue of Business Franchise.
Franchising presents variety of business opportunities across an eclectic mix of industries, with more than 900 brands using the model in the UK, so there is something for everyone and every budget.
If you are thinking about buying a franchise, you should make yourself aware of exactly what is involved and how to identify the businesses that best suit your needs. Making sure that the opportunity is what is appears to be is absolutely critical. Here are some of the key areas to consider and questions to ask yourself.
Research
Your research into a brand and its people is absolutely crucial to finding the right franchise for you – and avoiding the wrong one. Be thorough, and include the following:
- Speak to existing franchisees
- Understand the business
- Training
- Ongoing fees
- The people
- success rates
- Recruitment
Membership of the bfa
The bfa accredits franchisors using a stringent set of criteria based on operational procedures, franchisor/franchisee practices and the European Code of Ethics for Franchising. all members are listed on the bfa’s website to allow potential franchisees to determine which ethical franchisors have passed these checks.
Financial Commitment
Franchise businesses come with a wide range of investment levels. Assess and understand, from the beginning of your process, what you can afford to invest and how much you are prepared to borrow – and remember to consider working capital requirements while your business is establishing itself and may not be turning a profit. there are major banking groups that the bfa recognises as specialists in franchising: HSBC, Lloyds, Natwest, Barclays and Metro Bank. Make sure that you ask for their franchise departments from the outset.
Lifestyle
You need to be happy with the necessary commitments that come with making your new business a success. Franchising allows you to develop your existing skill set, or become your own boss doing something you are passionate about but inexperienced in, with full support and training, so think about what you are good at and can take on wholeheartedly. You also need to consider the support and understanding of friends and family, which some franchisors like to gauge as part of their recruitment process.
Professional advise
There are a host of professional advisers accredited by the bfa that specialist in franchising. these can be invaluable in making sure that you’re taking the rights steps: for example, when it comes to reviewing the franchise agreement, make sure you go to a specialist franchise solicitor – it can save you a lot of money in the long run.
Finally, take your time! Make sure you assess and reassess everything as part of your research before you fall in love with a concept and dream; you’re taking the rights steps; for example, when it comes to reviewing the franchise agreement, make sure you to a specialist franchise solicitor – it can save you a lot of money in the long run.
Finally, take your time! Make sure you assess and reassess everything as part of your research before you fall in love with a concept and a dream; your’re parting with your hard-earned money and making a commitment for several years, so it’s essential to be certain rather than making an expensive mistake. A good franchisor won’t pressure you into a decision; they understand the level of undertaking required and want serious people to join their network.
Visit the bfa’s website (thebfa.org) for objective advice, tips and information, as well as a list of all accredited member franchisors and advisers.