New entrepreneurs are appealed by the concept of franchising due to its various perks and advantages over starting a new business from the scratch. It also reduces the risks of a new born business while you are being sitting on the seat of the boss. Also, the fellow franchises and parent organization support the new franchise to ensure its success.
The most important question is to decide the type of franchise you must invest, especially when the franchise opportunities in Pakistan are rising with each passing day. The easiest method to take this toughest decision is to ask yourself several questions before investing your hard earned money.
Do I have Basic Business Skills?
As franchises, you must have the basic business skills. It is the baseline for running any franchise. You cannot have the industry experience without having the entrepreneurial drive and basic business know-how. The franchises with the realization of the need of sales and the art of marketing are welcomed. According to Tom Wood, President and CEO of Floor Coverings International franchise;
“We want franchises that are focused on customer service and ways to increase transactions,” he added. “Good-quality franchises are hard to come by.”
What is My Investment Budget?
Depending the specific business model and industry, the franchise prices vary greatly. The upfront fee of a franchise ranges from $10,000 to $1 million. According to Terry Powell, Founder and CEO of franchise business coaching company The Entrepreneur Source;
“Opening a food franchise will have a much higher investment than a home-based, business-to-business franchise, simply due to the amount of equipment and inventory necessary to start the business,” Powell said. “It’s up to the prospective franchisee to decide how much they would like to invest and what will help them achieve their goals, both short- and long-term.”
What Role Do I Want to Play in the Business?
You can either involve directly in running the business and play the role of the owner/operators or hire compatible staff to run and manage the day-to-day operation of the business and thus play the role of an absentee owner. According to Rhoda Olsen, CEO of Great Clips, hair salon franchise;
“Many franchisors offer a hands-on opportunity, [whereas] others offer more of a management opportunity. The key question [franchises] need to ask themselves is what they see themselves doing on a day-to-day basis. Do they really want to do a specific job every day? Do they want to lead an organization? Do they want to manage the managers?”