Becoming a franchisee

Establishing an independent business may seem like a lot of work. It does hold a great amount of risk. If you don't have an unique product in mind and you want to build upon the proven success, reputation, and customer base of an established product or sevice, then franchising is your answer. Unlike in independent businesses, decisions are made for you by experienced industry professionals. Your name, trademark, and product like are known, trusted, and recognizable from day one.

If you decide to go this route, you still have a large and vastly important decision to make - which franchise is right for you? Which franchise will keep you interested, will make proper use of your skills and knowledge, and will bring you profit in the end? You have a number of options as you begin to gather the information that will enable you to choose exactly the right franchise.

You may have considered visiting a franchise broker. Brokers have low fees and can match you to a franchise based on your education, skills, and psychological attributes. However, you should know that brokers match you based upon a small list of available franchises. Brokers are paid by franchisers to market their businesses. That means that brokers will not suggest all possible options, but only those businesses with which they are in partnership. In order to find the perfect franchise, narrowing your options by visiting a broker is probably not your best bet.

We suggest gathering your own information to make the most informed choice. Don't worry! A number of resources exist that can help you. The most important thing to remember at the information-gathering stage is to remain organized. Keep organized and detailed records of names, databases, and Websites. Be sure you record which information goes with which franchise or industry. Such detailed analysis will prove invaluable when the time comes to make your final selection.

Begin your information gathering by making a list of questions. When beginning a new enterprise, everyone has concerns and needs as well as more general questions. Write these questions down, and do not stop gathering information until you have a satisfactory answer to everyone. Try to find the overlap in your questions and answers. How do the questions and answers interact? Such observations can provide you with even deeper insight.

What kinds of questions should you be asking? In addition to any personal needs or expectation, you should consider company and product longevity, competition, and modernization. For example, you should research the company's past financial records and its relationship with other companies. You should also research where the market and technology are heading and assess the company's products and services in that light. Has the company stayed up to date with current trends? Are there any upcoming introductions of new products or services that might threaten the company's own products and services? If so, how would the company be likely to respond? Is the company expanding? Is it focused? What kinds of services and support does it offer its franchisees? Finally, if your franchise would require employees other than yourself, is the labor attractive? Would you be able to offer competitive pay rates?

The answer to your questions can be found on the Internet, in franchise and business directories, in books and magazines, and at trade shows.

• Internet: Much useful information can be found online. As with all Internet research, be careful of your sources. You should especially be sure to check the individual Web sites of the companies you are considering taking a franchise with.
• Directories: A number of franchise directories are available to assist you. Directories are the best place to begin the information gathering process.
• Franchise Opportunities Guide (www.Franchise.org): Published bi-yearly by the International Franchise Association (IFA), this guide contains essential information such as the names and contact information of franchisers, suppliers, and legal consultants specializing in the franchise industry. It also includes franchise statistics and articles of interest to the franchisee. You can order the guide through the IFA at (800) 543-1038 or via the IFA Web site for $17.
• Franchise Update Publications (www.Franchise-Update.com): This organization publishes a number of guides, including Executive's Guide to Franchise Opportunities; Food Service Guide to Franchise Opportunities; Guide to Multiple-Unit Franchise Opportunities; and Franchise Update Magazine. These are essential publications. For information about ordering them, go to the Web site or call (800) 289-4232.
• Bond's Franchise Guide (www.WorldFranchising.com): This guide covers both the US & Canada and includes contact information for more than 1000 franchisers. It costs $29.95 and can be purchased at (800) 841-0873 or via the Web site. World Franchising also publishes a number of helpful books.
• Franchise Annual (www.InfoNews.com): This guide also publishes franchiser contact information, along with brief business descriptions and fees. The guide is available online and can be purchased for $44.95 by calling (716) 754-4669 or via the Info News Web site.