With an increase in people looking to leave or change their jobs, as well as a rise in the number of people thinking of starting their own business, buying a franchise is definitely worth considering.
According to The Global Entrepreneurship Monitor (GEM) report for 2021/2022, more than 70% of Britons believe it is easy to start a business in the UK. 61% of respondents believed there were good opportunities to start a business in their area, yet 52% of these people cited fear of failure as a reason for not starting a new business in the next three years.
The obvious way to overcome those fears and make sure that you can access the support you need as a new business owner is to look at buying a franchise instead of going it alone.
This can be a great way to start your own business, making sure that you have a format and structure to operate, instead of having to start from scratch.
The latest British Franchise Association (bfa) survey shows that the franchise industry contributes £17.2 billion per annum to UK GDP, employing 710,000 people, with 93% of franchisees claiming profitability and less than 1% of franchises closing per year due to commercial failure.
So franchising should definitely be something to explore as you consider your options for leaving your job.
Some of my previous articles have looked at the research you should do, as well as the business planning needed but, as well as this important research and planning, you should also consider some other franchisor attributes before you sign up and agree to buy a franchise.
The bfa website (www.thebfa.org) is a great place to start, with details of the franchises which have been put through their accreditation process and have signed up to the Code of Ethics. They also have some resources to help, including a list of the questions you should ask a franchisor and a free online training course.
You will need to check out the franchisor’s financial strength, have the legal contract reviewed and research the industry sector the business is in, as well as having some conversations with existing franchisees.
As you research franchising, you will begin to narrow things down and make some decisions about the route you’d like to take.
You may prefer to buy a franchise with a well-known brand – this means that your franchisor will be a corporate and you will be unlikely to have a close relationship with the founders or owners of the business. Or you may decide that you would prefer to be part of a smaller network, where there is more of a ‘family’ feel. Franchising covers such a wide range of business sectors that there really is something for everyone.
Franchising involves committing to a long term relationship so it is worth making sure that you are signing up for the right one!
Here are some key qualities that I believe you should look for in a franchisor, over and above the more tangible aspects outlined above.
Experience. One of the key benefits of franchising is that the franchisor is providing you with a tried and tested format, after building up a successful operation first. If it is a newer franchise and the franchisor doesn’t have a core business already established, you need to look carefully at the level of support they will be able to provide.
- Consistency. Your research into the franchise could take some time and you will have many conversations and meetings along the way, possibly with a few different people. Are you getting consistent messages about the way the franchise operates, especially around the key areas of support and training?
- Commitment. This can be difficult to assess but you need to have confidence that your chosen franchisor is committed to helping you succeed. The legal agreement you will sign could be for five, ten or even twenty years so this is about forming a long-term business relationship. Ask your franchisor about future plans and ambitions for the network, how do they see the business progressing.
- Values. Shared values play a strong part in any relationship, do you know what the core values of the franchise include? At Revive! we have outlined our values to staff and franchisees and they are built in to our entire business: Integrity, Outstanding Customer Service, Technical Excellence and Unity. Strong franchisors want to recruit franchisees who will commit to their values, as they will act as an extension of the brand in their territory.
- Integrity. It should go without saying, but honesty and integrity on both sides in franchising is essential. You need to have confidence that the franchise you are investing in has been accurately presented and that you can rely on what you are being told. When you are looking at a franchise, make sure you are not swayed by a slick sales pitch or glossy marketing information.
Provided your research has given you confidence that your chosen franchisor has strong values, plus experience, commitment, consistency and most importantly, integrity, you will have a much better chance of effectively building a long-term franchise relationship and a successful franchise business.