Over the past few decades the public franchising business model has emerged to provide new opportunities for anyone who might be looking to start a business but does not want to start completely from scratch. Buying into a franchise is not easy, of course, but it does come with certain advantages that will make it easier to succeed.
And if you want to succeed—and who doesn’t—here are some things you need to look for in a potential franchise Ben et Florentine investment:
When it comes to a restaurant franchise, in particular, one of the most important things you need to know before you invest is whether or not there is consumer demand for this brand. In addition to whether or not people are clamoring for it now, you also need to ensure that there is continued and/or future demand. Yes, it is important to be trendy and popular, but if you cannot sustain the profits, there is a better chance at failure.
FRANCHISE STRENGTH (BRAND POWER)
To piggyback the first consideration, you next need to look at the brand’s strength in the market. Consider how much competition there is (and will be in the future). Consider also what the brand’s financial statement says about its growth potential. If the brand has been growing and has excellent potential, it could be quite a worthy investment.
If the franchise you are considering is through an older, more established company, this is not something that should concern you, as the company has probably already set an example for how well they analyze the market. If you are considering a newer company, though, you need to look at how they plan to achieve growth.
Less crucial but still important, you might also want to look at how the franchisor selects people and locations and partners. Is there a typical “franchisee profile” for example: do they typically only sell to people with a track record of success or do they just sell to whomever has the money? One is responsible and the other can be quite reckless.
Finally, you will also need to closely examine the legal agreement or the contract. Better yet, have an independent lawyer—a third party franchise law attorney—e take a look at the terms and conditions. While it is unlikely you will find anything illegal or unfavorable, it will help you to configure your own contingency plans, etc.