There are many factors that can you help you to achieve success as a franchisee. One of the benefits of the franchise model is that it provides a proven system for success. If you’re a newcomer to Canada and looking to start a new business, this can be a smart way to start a successful business.
Following a franchisor’s system can often reduce the risk of starting a new business from scratch. While the franchise system can be a great model to follow, there are other factors that will help you to succeed.
3 Keys to Your Franchise Success
Here are three ways that can help you to achieve franchise success:
1. Select a Franchise that “Fits” Your Personality
An important element of your success is to ensure that your personality is a fit for franchising. This comes from self-awareness of your strengths and interests.
The 3 critical elements of job fit include your:
- Knowledge and skills (gained through your training and education)
- Experience (gained from past jobs, volunteering, and other activities)
- Fit and compatibility (how your personality matches other successful franchisees)
When these three elements line up, there is a great chance that you would be a great fit for franchising. Consider the last job you held where there was a good fit between the job and your personality. Chances are that your performance was high, and you really loved what you were doing. That’s because what the job required nicely matched who you are as a person.
2. Make Sure You Have Enough Money
As with any business, you need to know how much money you will need to make and how much of your own money you can commit to the franchise. This also applies to how much borrowed money you can commit to the franchise. Be sure to get as much financial information as you can about the franchise before you buy.
The Franchise Disclosure Document (FDD) includes information about how much you will have to pay for fees as well financial statements and other fiscal performance. It also makes sense to speak with an accountant to help you understand the financial statements.
An accountant can review your financial health and how it will be affected before you sign a contract. It will take time before you make a profit, so you need to know that you can cover business and personal expenses for an extended period of time.
Speak to other franchisees to find out if they are achieving their expected revenue and profit goals. You may also want to ask how long it took them before they made a profit.
3. Do Your Research
You can start your research by reading the FDD, but you will need to conduct your own research as well. Here are some research activities that can help you gather more information about the franchise:
- Speak to current and former franchisees (their names are provided in the FDD)
- Hire professionals to help you understand legal and financial documents
- Make sure you understand the types of cost you will have to cover (including hidden costs that may include: free products to give away for special promotions; or opening day expenses.)
- Conduct online research to investigate the brand’s reputation
- Conduct your own market research.
It will take you anywhere from three to six months to complete your research. This may seem like a lot of time but purchasing a franchise is a big decision. It involves a large investment of both your time and money, and you want to achieve success.
Take the time to do this research before you sign any contract so that you do not face unexpected or costly surprises. These keys to franchise success can help you make an important business decision that’s right for you.
If you’re a newcomer to Canada and interested in exploring franchising as a business opportunity, we want to help you make an informed decision by providing you with:
Whatever your decision, our Franchising for New Canadians program can help you decide if franchising is right for you!