I have been fortunate enough in my career to be exposed to business and franchise ownership from many different angles. Even though success in owning a franchise is influenced by many factors, there are some fundamental ingredients that matter.
Buying the right franchise is not about how much you like its product or service and is not about being first to market in your geography. It is also not about following the hottest trend based on the latest statistic, choosing the franchise with the best track record, or even about following someone else's lead who was successful doing it. It's about finding a business that fits your skills, lifestyle, and goals & objectives. It's about reducing business risk by matching your skills and abilities to the optimum franchise opportunity for YOU, which would result in the best long term success.
Understanding your skills has to do with being honest with yourself. It's about asking yourself some basic questions:
The optimum franchise opportunity can fall in one of four categories of business opportunities, with each category having its own characteristics. Of course, doing the basic due diligence with respect to market size, growth of the industry, outlook in the marketplace, franchisee satisfaction etc., is a must. However, understanding where each opportunity falls in the grand scheme of things is important.
As an example, take my experience in choosing a Home Care franchise as an investment in 2007. I knew that I wanted to partner with my wife, who has social services/psychology background. I knew we were both comfortable dealing with people, both clients and employees. I knew I could apply my organizational skills to help run operations. However, as the figure below suggests, a business like that requires proactive, even very proactive marketing. That means reaching out to clients and client referrals sources, and establishing relationships, presenting/public speaking, consultative sales, etc. Those requirements may not be the right fit for everyone, no matter how high-growth, how much in-demand that kind of business promises to be.The figure below shows the four business categories and their characteristics:
How can you strengthen your chances of success in picking a franchise? Understand yourself and understand the nature of the business opportunity. Find the best intersect and best match between those two variables, and know you are on the right path.
Mr. Georgiou is currently the President of CrossRoads Business Brokers, Inc. & www.TheFranchiseCrossRoads.com, and has been involved in a great number of business transactions over the last 10 years. He is also a national Franchise Consultant with FranChoice advising hundreds of franchise Candidates in their search for a franchise. Since 2008, he has been a successful multi-unit owner/operator of a Home Care Franchise in California. Previously, Mr. Georgiou was a former Senior Manager with KPMG Consulting (BearingPoint) where he advised and assisted various Mid-Market companies with operations, strategy, and systems.