The wrong reasons

Many people who start their own business, especially if it is a new concept, dream of turning

it into a franchise. They have devised a successful formula and want to grow by opening

more branches. There are two ways to do this; recruit a management team and start looking

for sites or start a franchise.

To the uninitiated the franchise route would appear to be far easier because it avoids the

problem of recruiting and managing the right people and the operational costs of a network

of company owned branches. Much easier surely to recruit franchisees who will invest their

money to open the branches and then manage them. All that the franchisor needs to do is sit

back and rake in the royalty fees.

Some franchises do start like that but ultimately most fail. The reason is that the

management of a franchise is just as complicated as any other similar business. Those who

decide to turn their business into a franchise in the mistaken belief that it will be easy will

probably fail. They will also cause similar difficulties for their franchisees.

The wrong reason for becoming a franchisee

Most people enter the world of work as an employee. Some later tire of being an employee

because they want to be more successful by starting their own business, Others decide that

they don’t like having a boss so they quit and start being self employed. The first group make

great franchisees, the second group don’t.

An experienced franchisor will understand this factor and be paying attention to it when

evaluating an application for a franchise. Some use psychometric testing, some use other

methods. Regrettably some franchisors either don’t know or don’t care about the difference.

Prospective franchisees should ask themselves. Do I want to be the boss or do I wish I didn’t

have a boss. Those in the first group should find a suitable franchise and get started. Those

in the second group should change jobs and try a different boss.