How Do You Choose The Right Franchise|
by Jim Brown
Once you have decided a franchise is the right route
for you, how do you choose the right one? To choose the
franchise that is right for you and that will fulfill your
business dreams, you must know yourself, your skills, and
your dreams and aspirations. You must begin the process by
analyzing yourself. You can start by investigating into
various industries that interest you. Once you have
narrowed down the choices to a few industries, study your
geographical area and determine if there is a market for
that type of business. If so, follow a research plan and
begin contacting the franchise companies that you believe
have potential in your area. Any reputable franchisor will
send you extensive information about their business at no
After you receive this information, which is usually
disclosed in the offering circular (also known as the
Uniform Franchise Circular Offering or UFOC), you have to
read it carefully. Read between the lines and do your
research. You can go to the library, look online as well
as in professional journals, trade magazines, reference
books, government publications, and annual public
corporation reports. Check with the Federal Trade
Commission (FTC), the state franchise authority, and the
local Better Business Bureau to see if there are any
problems with the company. You can also contact local
chambers of commerce or business development organizations
and see if they can supply information pertinent to you
research. Try to determine if this company is doing well
in terms of its financial health, management, reputation,
and growth prospects.
After you have read the offering circular, ask the
franchisor for a list of franchisees that you can contact.
Current franchisees are a great resource and can give you
detailed insight on how the company is really doing, what
to consider before and after you get into the business, and
other critical information. You should visit franchise
stores and corporate headquarters to uncover any
information that will help you make your decision.
Assemble a team of professional advisors, including a
franchise attorney and an accountant. They can help you
answer technical questions and will be a useful resource
throughout the research process.
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