by Jim Gormley | Feb 19, 2020 | Franchise Opportunities
If your thinking about buying a franchise, you may be wondering if you should use a franchise consultant. A seasoned and ethical franchise consultant can maximize your success because of three key areas that they bring to the table:
- Knowledge
2. Experience
3. Franchise Fit
Before we continue, I’d first like to ask you to consider that if you were looking to purchase a house would you do so without consulting with and using a real estate broker? Most, I think would say, no. And why? Because the best real estate brokers have significant:
- experience and knowledge of the current housing market
- knowledge of the best locations, and
- knowledge of preferred residential development areas.
But most importantly, a qualified real estate broker can help you find a house that is aligned with:
- what type of house you want to live in
- what location makes the most sense for you and your family
- your required price range and budget.
And not unlike the real estate broker, the role of the ethical franchise consultant is to help you:
- screen through the franchise opportunities
- narrow down your choices, and
Ethical franchise consultants can help you cut through the weeds and can be an invaluable asset to you when navigating the franchise industry in Canada.
3 Reasons to Use a Franchise Consultant
1. Franchise consultants have valuable knowledge
Someone famous once said:
If you don’t know where you’re going any road will take you there.
Well buying a franchise is no exception. Except that in this case, if you don’t know the franchise that’s best for you, choosing any franchise won’t get you there. And, it will probably end up costing you a great deal of time, effort, frustration, stress, and money.
Did you know?!
That there are:
- approximately 1,500 individual franchise brands operating today in Canada, and
- almost 76,000 franchise locations with a combined GDP in excess of $100 billion dollars (2019).
And annually there are literally hundreds of new franchises joining the ranks of those already established and emerging franchise brands. These franchises represent almost every consumer and service sector you can think of, with investment levels that vary from under $10k to well over a million dollars.
As you can imagine, there are literally hundreds of thousands of pages of information and data about the myriad of franchise choices there are out there to choose from. And, a knowledgeable broker can help you cut through the clutter to point you in the right direction.
Franchise Consultants are a crucial source of franchise industry information. For example, franchise consultants:
- understand current provincial franchise legislation
- know what financing options are available to new franchisees
- have important contacts with traditional banking, non-traditional financing, and government funding
- have insight into current and future franchise trends.
And combined, all of this information is critical for budding entrepreneurs. We can help you learn the basics of franchising, and assist you to prepare your business plan and perform your due diligence.
2. Franchise consultants have broad experience:
Based on our knowledge and experience, The Franchise Consulting Company can help you structure your approach in the most strategic and valuable way. And, we also know how you can best articulate and present yourself to franchisors.
Qualified ethical franchise consultants like The Franchise Consulting Company can help you maximize your chances of success. We know that investing in a franchise is a two-way street. So during the recruitment journey, it’s important that you know what to look for in a successful, ethical franchise system and what questions to ask throughout the process.
For example, it’s quite common for candidates to look at franchise companies and see a lot that they like. But, they may overlook things, or choose to minimize things they don’t want to see and feel they have to settle.
However, if you have done your due diligence and have a clear vision of what you want, with the help of a solid franchise consultant you should not have to settle. A good franchise consultant will eventually bring the perfect match to you.
While falling for a certain franchise sector or system isn’t necessarily a mistake, it can blind you to key questions you should be asking. Often, the consultant is there to help protect you from yourself.
Franchisors expect to see candidates with at least a basic understanding of franchising. And, if you’re able to demonstrate this knowledge, as well as your own initiative by being armed with sensible, relevant questions throughout the process, you are guaranteed to stand out.
Related Posts:
How do I identify a great franchisor?
Franchising for new Canadians: five common mistakes to avoid
3. Franchise consultants know about fit for franchising
Lets talk about franchise fit for a moment.
A recent survey of the top franchise systems in North America asked the question: ” What are the top characteristics that a franchisor looks for when interviewing a potential franchisee candidate for their franchise system?”
All gave the answers that you would normally expect, such as:
- previous business experience
But, what was interesting about this particular survey and different from previous such surveys was that Fit was number one. In the majority of cases, personality fit was the characteristic most important to move forward with any candidate regardless of all other considerations.
So what do we mean when we talk about fit?
Personality fit refers to how aspects of your personality match the requirements of the franchisee role. For example, when personality fit is high, you will have:
- energy and motivation to do the job in the best possible way
- a positive outlook regarding people and processes
And, you’ll be enthusiastic about innovation and new ways of doing things when required.
To learn about your fit for franchising, I encourage you to complete the free Franchisee Self-Assessment. By completing our Franchise Self-Assessment, you can use your results to determine if you would be a great fit for franchising. The results can help you to sell yourself and demonstrate that you would be a successful franchisee candidate. And you might just find out something about yourself that you didn’t know!
Complete the free Franchise Self-Assessment today!
How do franchise consultants find the right fit for you?
Like any investment, buying a franchise business carries risk. And while using a franchise broker does not remove all the risk, it can help minimize it. Ethical franchise consultants will spend hours with you before they even think about suggesting a franchise.
We want to know your:
We want you to understand the pros and cons of franchise ownership. We want to know just how committed you are to the business? Are you a good manager? Do you work well with employees? All of these things help us match your characteristics to the characteristics of the franchise.
Ok, so how much is all this going to cost me and who pays the broker for all of this advice? Well, the good news is that it’s at no cost to you!
Traditionally, those buying a franchise business do not pay the franchise brokers. Franchisors do because they view the cost of the brokers as a marketing expense in order to get qualified candidates.
The Franchise Consulting Company and Franchising for New Canadians, are valued by our franchisor partners for one thing – we introduce them to only qualified candidates.
By that measure, a franchise consultant with an established record and a long history is a sure bet.
Key takeaway:
Buying a business is a huge decision and typically filled with emotion and stress. A franchise broker can be a beneficial ally to ease the indecision and anxiety and help guide you to your ideal fit.
Finally, As qualified ethical franchise consultants who have been there, done that, seen it all from both sides, and bought the t-shirt, I’m confident that choosing the right franchise consultant will help you pick the right ship.
After all purchasing a franchise will be one of the most significant financial investments that you will probably make during your lifetime. Make sure its the right one!
So to answer the question we first posed “Why would I use a franchise consultant?” I would simply say “Why wouldn’t you?
by Corinna Frattini | Dec 27, 2019 | Franchise Opportunities
Millennials are finding franchising success as the franchise ownership demographic is starting to change. The millennial cohort is the generation born between 1980 and 2000 and represents approximately 9.8 million people in Canada.
Millennials are also the most ethnically diverse generation that Canada has ever seen. This diversity contributes to innovative thinking, enhanced creativity, and access to broader networks and relationships. The bulk of immigrants to Canada is millennials because Canada’s immigration point system favours younger applicants.
Statistic: Number of immigrants in Canada in 2017, by age | Statista
Find more statistics at Statista
You may think the typical franchise owner is someone established looking to leave a corporate gig, or a baby boomer with a high net worth, but that’s changing. Millennials are finding franchising success and it may just be a perfect fit.
What Millennials Offer to Franchisors
For franchisors, the millennial cohort can provide:
- A solution to retiring baby boomers leaving the franchise system
- Access to an energetic, passionate, educated, and tech-savvy talent pool
- Opportunity to shape owners who will be leading the business.
Millennials value mentorship, expertise, and teamwork. This is invaluable since franchisees succeed when they can tap into training, support, and business know-how.
What Franchisors Offer to Millennials
For millennials, the franchise model provides benefits that include:
- A business framework and set of tools for those who may lack years of business experience
- Strong training programs to develop or enhance business skills to operate a business
- Access to a network of existing franchise owners for support and guidance
- Marketing and other critical expertise from a recognized brand
- Opportunity to jumpstart business and entrepreneurial goals
These combined benefits can reduce the burden of building a new business from scratch, yet still appeal to the entrepreneurial goals of millennials. Millennials could well be the future of the franchise industry.
How to Increase Franchising Success
The franchise industry in Canada has seen double-digit growth in recent years and the number of new franchise brands and outlets continues to grow. There are over 78,000 franchise units in Canada, and 4,300 new franchise outlets open each year. With such a broad expanse of franchise brands to select from, here are some things millennials can consider to increase their franchising success:
Search for Brands that Match Skills and Education:
Millennials are highly educated so take advantage of your academic background to increase your franchising success. For example, educators may want to pursue franchise categories related to educational products and services.
Do Your Research:
Millennials are resourceful so put that skill to use and explore franchise categories and potential franchisors. The Franchise Disclosure Document provides extensive information about the franchisor.
Speak to Other Franchise Owners:
The Franchise Disclosure Document provides a list of current franchisees. Arrange to speak with franchisees to find out more information about the franchisor, industry trends, and their franchising experience (both positive and negative) to avoid any surprises.
Related Posts:
Explore your Financing Options:
While franchise fees can be expensive and even prohibitive for millennials, franchisors offer a range of investment levels and some may be as low as $10,000. Determine what available cash you may have and look to other financing options that may include:
- Traditional bank loans
- Supplemental financing from friends and family
- Canada Small Business Financing Loan
Millennials are finding franchising success and the mutual benefits that franchisors and millenials offer each other could be a perfect partnership.
Visit the Franchise Consulting Company for information to help you make an informed franchising decision. Whatever your decision, we can help you decide if franchising is right for you!
Corinna Frattini is the content marketing strategist at Prepare for Canada and contributes articles related to working in Canada. With a background in human resources and leadership development, her articles focus on what Canadian employers seek and how newcomers can continue their careers in Canada.
by Jim Gormley | Dec 5, 2019 | Franchise Opportunities
Franchising for new Canadians can be a rewarding financial and professional experience! And, for new Canadians who have the right personality, attitude and ability to work as part of a team, it can be a great career opportunity. If you’re exploring franchising as a possible career opportunity, you are likely excited and eager to get started right away. Excitement is great, but you need to use that energy to understand what’s ahead of you so that you make an informed decision. This will take time, but it will also help you to avoid five common mistakes that could be costly.
Spending time at the front-end before you sign a franchise agreement, can help you to:
- Reduce financial challenges related to your level of financial resources
- Choose a great franchisor with a strong brand, business history and reputation
- Ensure that you will be happy with your decision to open a franchise.
Five common mistakes that potential franchisees make:
1. Not Consulting with Legal and Financial Experts
I can’t stress enough how important it is for you to work with a franchise lawyer and financial adviser/business accountant. And, to do so the earlier the better in your journey to being your own boss. By speaking to both of these professionals, they can identify any legal or financial issues that may not be in your best interest. Better you know about issues before you go too far down the franchising road.
By identifying any issues, these professionals can help you to avoid or minimize any unexpected costs, obligations, or challenges related to the franchise contract. The decision to own a
franchise is a large investment of your time and money. And, professional advice can help to minimize the risk and usually overcome legal and financial roadblocks before you sign a franchise agreement.
Professionals can also help you to understand complex Canadian legal or financial requirements that you may not be familiar with. So, it’s important that you ask them any questions you have to increase your understanding.
To get more expert thoughts and tips from franchise legal and financial experts, visit the Franchise Consulting Company.
2. Not Conducting Thorough Due Diligence (Research)
Now is not the time to save time by doing incomplete research. This will not save you time. In fact, this initial research may be where you need to invest most of your time. If you spend time talking to both current and former franchisees, you can gather information that either confirms your decision to work with a particular franchisor, or you may decide you want to explore other franchisors. Either way, knowing this information early on will save you time and money.
It’s important to speak to a number of current and former franchisees. It may be tempting to speak to only one or two franchisees. However, it will be easier for you to spot themes and trends if you speak to more people. Have an open mind and listen carefully to what the franchisees are saying. Think carefully about what information you would like to gather, Here are just a few areas that you can explore:
- The nature of the franchisee’s relationship with the franchisor
- Did the level of sales and profit meet or surpass the franchisee’s expectations for the business or were they less than their expectations
- How the franchisor settles disputes
- The level and quality of training and ongoing support
Former franchisees can also provide important information about why they left the system. This could tell you important information about the culture of the franchise.
Once you collect the information, you need to be honest with yourself about the information you have gathered. Avoid relying on a “gut feeling” to guide your decision making, or only paying attention to the positive information that you heard. Ideally, you want to make a decision based on balanced input.
The information you collect will either confirm that you are making a sound decision, or you may decide to research other franchisors. In any case, you can be confident that you have not cut corners and entered into a situation solely based on a gut feeling.
And, our Franchising for New Canadians program can provide you with important information to consider when you conduct your franchise due diligience (research).
3. Not Creating a Business and a Personal Budget
A large risk occurs when franchisees do not have enough capital to get them through any unforeseen downturn in the economy or changes in the marketplace. There could be a number of reasons why you would need more capital. You need to prepare for this. Speak to an accountant to help you to understand the costs that you will have to cover.
Create a personal budget that will allow you to cover one year of personal expenses to handle unexpected financial demands with confidence. An accountant can help you understand what your investment would mean for your personal financial situation.
4. Over-Estimating How Much Control You’ll Have as a Franchisee
This item speaks to your “fit” for franchising. If you are a newcomer to Canada, you likely have many traits that would serve you well in franchising. It takes hard work and long days, optimism, determination, patience and focus on achieving success to uproot your life and move to a new country. These traits are also essential in the franchising environment. However, to be a successful franchisee, you will be required to follow:
- Prescribed operating manuals
These are proven systems that have contributed to the franchisor’s success. So, if you desire to do business your way, you may face problems with the franchisor.
How willing are you to follow these guidelines and systems? This is a minimum 10-year commitment and if following these guidelines is going to be difficult for you, perhaps franchising is not the best business option for you. Again, you need to be honest with yourself when you ask yourself this question. Better that you know this about yourself before you pursue a franchise opportunity. Not everyone is cut out to be a franchisee. If you’re not a fit for franchising, you will not be happy or satisfied for very long.
Related Posts:
5. Not Matching Your Skills and Interests with Franchise Opportunities
The franchise industry has many different sectors and many categories within those sectors that you can select from. Take time to identify your skills, interests, knowledge, and related experience to find a franchise sector (for example: Food) and category (for example Indian) that aligns with your interests and passion. No matter how profitable a particular franchise is, it won’t be long before you are dreading what you’re doing if your heart isn’t in it.
Increase your self-awareness of your strengths and interests and then explore franchise categories that align with your personality. Once you have landed on a particular category, search for brands that best represent that category. Again, this is important research, so take your time and collect all of the information that you need.
You can minimize your risk and avoid a decision that can be costly and stressful when you pay attention to these common franchising mistakes. You will be even more excited about your potential franchise opportunity in Canada when you know you have taken all the right steps.
Visit the Franchise Consulting Company for more information to help you make an informed franchising decision.
by Jim Gormley | Dec 4, 2019 | Franchise Opportunities
If you’re a newcomer considering franchising in Canada, you may be wondering: how do I identify a great franchisor? You may already be researching the franchise brand, including the quality of the product or service. That research is critical. But, have you done in-depth research on the franchisor? You have to assess the franchisor to make sure that you select a great franchisor. So, here are three key signs to assess that identify a great franchisor.
For more information about franchising in Canada,
download our free e-book!
Three Key Signs that Identify a Great Franchisor
Franchisors are selective about who they choose to represent their brand. And, you should be selective too. If you’re exploring franchise opportunities, you likely know that the franchise model can be very successful. And, that business success will grow when the franchisor demonstrates:
- Strong leadership and vision
- Positive relationships with their franchisees
- Support for their franchisees
1. Leadership and Vision
The franchise leadership team sets the vision for the business and how they plan to accomplish their goals. So, you want to understand their vision for the franchise.
To identify a great franchisor, you want to know:
- Do the leaders have a clear vision for the company and the brand?
- Who are the leaders and what role do they play in the company?
- Do they have relevant skills and experience to contribute to the company’s success?
- Does their leadership style inspire you to follow their lead?
- Do they demonstrate a passion for the company and the brand?
- Do they lead with values that are similar to your values?
- Do they have a clear understanding of the marketplace and industry trends?
And, when you know the answers to these questions, you’ll have confidence in their leadership ability.
for information to help you make an informed decision about franchising.
2. Positive Relationships with their Franchisees
The Franchise Agreement lays out the role of the franchisor and the franchisee, but it’s important to understand if thy get along. A great franchisor will have a positive relationship that is built on trust and open communication with their franchisees. This will also lead to greater business success for both the franchisor and franchisees.
And, to learn more about the relationship, it’s essential that you speak to current and former franchisees in the system. This will give you information about their experience with the franchisor and the quality of the relationship.
To identify a great franchisor, you want to know:
- Do franchisees have good things to say about their relationship with the franchisor?
- Does the franchisor ask for input from their franchisees related to marketing strategies, new products or services, or other operations issues?
- Does the franchisor listen to franchisees and value their input?
- Does the franchisor have a Franchise Advisory Committee or Association that is made up of franchisees and management?
- How does the franchisor resolve disputes with franchisees?
The Franchise Disclosure Document provides the names of both current and former franchisees in the system. So, speak to as many franchisees as you can to get a balanced picture of what the relationship is like.
When you speak to franchisees, you can gain their insight into their franchising journey. So, be prepared to ask any questions that you have, and listen to what they have to say.
Based on their feedback, you can decide if this is the type of relationship that will meet your needs.
3. Support for their Franchisees
Based on your self-awareness, interests, and skills and knowledge, you know what you have to offer the franchisor. You know your strengths, and you also know where you may need more support.
For example, if you have strong marketing skills you may need less support in this area. But, you may require more finance support. In other words, a great franchisor provides the specific support that you require.
Related Posts:
To identify a great franchisor, you want to know:
- How much initial training and support does the franchisor provide?
- What does that training cover?
- What is the quality of their training tools and resources?
- What marketing and advertising support do they provide?
- What additional support does the franchisor provide?
Franchisors like to hear that you know about the product or service that they offer. And, they’ll also be impressed when you can show them that you understand their:
- leadership and vision for the franchise
- relationship with their franchisees
- level of support they provide to franchisees.
By gathering information and speaking to other franchisees, you can collect valuable information to ensure that you identify a great franchisor.
And, if you’re a newcomer exploring franchising in Canada, the Franchise Consulting Company can help you make an informed decision.
by Jim Gormley | Dec 1, 2019 | Franchise Opportunities
If you’re considering buying a franchise in Canada, it’s essential to know how to research a franchise opportunity that’s right for you!
As a potential franchisee, there is a great deal for you to gain…or lose, from your franchise investment. So, your franchise research is critical to make a selection decision that’s best for you and your success. It’s best if you spend time at the beginning of the process to avoid any unforeseen surprises after you’ve made your investment.
For more information and resources to help you make your franchising decision, download our free e-book!
Could not find block specified! Please check out the Shortcode parameters.
No doubt, research is a time-consuming step, but it’s also the most important step. Research the franchise like you would any other large investment that you may have made in the past. Remind yourself of the research you conducted when you decided to move to Canada. Research is important! If you have made the decision that you would like to invest in a franchise brand, you have likely:
- Determined that your personality would be a great fit for a franchising
- Identified franchise categories that are of interest to you
- Selected the brands that best represent the category or categories that you have chosen.
You may want to take a step back if you haven’t already completed these steps before you proceed with your research. However, if you have completed these steps, now it’s time to carefully research the specific franchise (or franchises) that you may want to join.
Three Key Activities to Start your Franchise Research:
1. Start with the Franchise Disclosure Document
Obtain and review the Franchise Disclosure Document (FDD). While reading the FDD may seem demanding, you will learn a great deal about the franchisor’s history and key leadership team. You’ll also find information such as:
- The history of the franchisor and if they have been sued or faced bankruptcy
- How much you will have to pay for fees
- The type of support you can expect as a franchisee (including training, territory, franchise renewal, etc)
- Your obligations as a franchisee
- Financial statements and other fiscal performance
- A list of current and former franchisees, and their contact information.
Reading this document will provide you with information to assess which franchisor will be the best fit for you. If you’re considering a number of franchise brands, you can compare the advantages and disadvantages based on similar criteria that is provided in the FDD.
2. Speak to a Franchise Lawyer and an Accountant
The FDD can be lengthy and complex. A franchise lawyer can explain, or help you to understand the FDD in clear terms. As well, a franchise lawyer can help you to discover pitfalls early in your decision making process. While you may not understand everything in the document, it’s a good idea to be familiar with the document before you speak to a lawyer.
In the same respect, it’s important to speak with an accountant as well. An accountant can help you understand the franchisor’s financial statements and select a franchise system that matches your investment resources and goals.
Be sure to ask questions about things that are not clear to you or that you don’t understand. That’s a big part of the role of the franchise lawyer and accountant.
3. Speak to Current and Former Franchisees
Every franchisor is required to list contact information of current and former franchisees. Make sure to speak to a number of franchisees to gain a balanced view of what it’s really like to be a part of a franchise system. There is great value in speaking to business owners who have made the decision that you are now considering. Also, it’s another way to get an honest assessment of the franchisees’ experiences (both positive and negative) that are beyond what you would read in the FDD.
Once you have completed this research, you’ll need to assess and evaluate all of the information that you have collected. Be sure to be honest with yourself and determine if the franchise you’re considering is best for you based on what you know about yourself including your: skills and knowledge; interests; and fit and compatibility with franchising.
Related Posts:
Conducting franchise research is a critical due diligence activity before making a decision to purchase a franchise. Take the time necessary to conduct thorough franchise research to avoid any unwanted surprises and maximize your investment and franchising success.
Visit our Franchising for New Canadians Learning Center to view tools, resources, and information to help you make an informed franchising decision.
