Countless people cultivate the dream of owning a business. For many, becoming a franchisee offers a superb way to achieve that goal. Ultimately, it can be the best of both worlds – running your own business but still having access to the resources and name recognition of an established brand.
However, individuals might rush into signing the franchise agreement without paying careful attention to possible hazards that could dramatically impact the success of their business. Here are three tips to avoid common pitfalls.
- Finding the right location: Typically, the franchisor will have completed research or developed insight into locations that will support additional businesses. Based on past history, established competitors and regional demographics, the success of your business can hinge on your choice of location.
- Market research: It is important to discuss the market with your franchisor. What are the strengths and weaknesses of other franchises in the area? What marketing efforts have worked or failed to produce results in this area? It might be beneficial to ask other franchisor the same types of questions.
- Examine the business model: Take the time to identify the franchisor’s business model, its history in the area and the amount of support it provides.
Working with an experienced business law attorney can provide you the guidance and clarity of insight needed to develop the necessary operational documents. Your attorney can also thoroughly review your franchise agreement to question any terms or conditions that might need to be revised. It is crucial that you take the time to fully understand the challenges you might face.
