Small Business Plans and Ideas

Want to buy a franchise opportunity? Great idea! Here is a high-level overview on what to look for:

Operating History - A long history of success is the #1 thing to look for. If many other franchisees have been successful over the years, your chances are probably pretty good that you will be successful too.

Location, location, location – Investigate the territory rights. Make sure that your site selection is a good one. Don’t settle for a second rate site.

Investigate – Don’t believe everything you hear or read from the franchisor! Investigate. Lean on those experts around you such as an attorney or an accountant. Visit some existing franchisees(choose to visit ones that the franchisor does not recommend, not just the ones that they feed you).

Labor pool – If your franchise is labor intensive (example: restaurant), what is the depth and quality of the available labor pool? Any business needs a strong qualified workforce in order to succeed.

Initial training – Make sure that you and all key employees are adequately prepared. Grand opening support is a must.

Ongoing support – A critical component for success. Make sure that all levels of support are included, and get it in writing upfront! Don’t rely on their statement, “Don’t worry, we will take care of you”.

Marketing programs – Franchise marketing is important. Make sure that any marketing dollars contributed to the franchisor are spent wisely.

Purchasing power – Can the franchisor pass on cost savings to you based on mass purchasing power?

Investment amount - While the upfront cost of the investment can seem expensive, in the long run it is probably not. A more significant expense can be the ongoing royalty and marketing fees.

Exit strategy – If the opportunity does not work, what is your exit strategy? Will the franchisor assist you in re-selling the franchise? Will they help market it for you? Many franchisors will actually provide a section on their web site for franchise re-sales. Beware if there are a lot of re-sales relative to the total number of franchises in existence.

After recently updating our office phone system, I have a few pieces of advice to share about purchasing an office phone system. We thought we did enough research to make this a simple purchase and installation, but found out later that we really had little idea of what we were getting into. This, in itself, wouldn’t be so bad, but the phone supplier we went with flatly refused to help us out after the sale. We ended up having to contact another vendor for the information we needed to make our new phones function properly.

First, and let me stress this; always contact the vendor prior to the purchase. Not only do you want to know who you are dealing with, you need to know if it is someone who can and will answer your questions and who will stand behind the products they sell.

Second, always go with a vendor who has more than one option for phone systems. We found out after we had already purchased our new phones and equipment that there were phones on the market which would have served our specific needs better and would have cost less than the phones we went with.

Third, always think about compatibility. We thought that because we had purchased the same brand of phone, that we could simply switch out the new phones for the old ones and that our line equipment would never notice. We did ask the supplier before the purchase if there would be compatibility issues and were told, “it should be fine”. That should have set off a red flag, but one likes to assume that someone selling phones might know a thing or two about them. See rule number one.

Finally, do a healthy amount of comparison shopping. We went with the first supplier because he was the cheapest of three that we had looked at. Three was nowhere near enough. We found out after it was too late that the vendor we contacted for help had the same phones for cheaper (although he would have been kind enough to steer us toward what we really needed) and offered far superior customer service.

In short, purchasing a new office phone system, whether you have five lines or five hundred, is a big investment. Follow the step that we didn’t, and you’ll save a lot of time, money and effort. You’ll be glad you did.