“Ignorance is bliss” they say, but be careful not to apply that to the franchising industry. Whether it’s a small barber shop or a larger restaurant, opening up a franchise comes with a list of responsibilities. The beauty of acquiring a franchise is that you get the opportunity to learn off other people’s mistakes. Want to join the growing franchise industry in Canada? With over 78,000 franchises in Canada, your name could be on the next one. So here’s some insightful wisdom on common franchisee mistakes for you to avoid.
Mistake #1 Lack of Communication with Other Franchisees
Joining a franchise is like joining a family, you have a team to look up to and members to assuage your concerns. Establishing consistent communication with franchisees falls under the due diligence of a franchise owner. Neglecting such a wide pool of opportunities, experiences and background knowledge is a poor business decision. Technology has facilitated communication amongst franchises regardless of their geographic location. Pay particular attention to fellow franchisees as they will guide you through obstacles and the maze of establishing a successful franchise.
Mistake #2 Thinking You Can Run the Show on Your Own
Expecting complete autonomy from a franchisor is a desire that won’t be satisfied. Although you are your own boss, you must adhere to a pre-established formula, plan and business model. Franchisors establish a concrete plan of action and in order to maintain their brand reputation, they seek that all franchisees pursue the same model. Remaining true and authentic to the brand is the epitome of a good franchisee. Failure to comply with the proposed model can result in the invalidation of your legal agreements.
Mistake #3 Not Having a Vision for the Future
A franchisee is still an entrepreneur, a position which requires both a drive and vision. One common misconception is that the franchisor will always motivate and rescue the franchisees but this is not always the case. Going into business, regardless of the industry requires an entrepreneurial vision and a desire for growth. Having a vision enables you to work harder and motivate your employees. Lisa Shepherd Founder of The Mezzanine Group , shares her wisdom by stating that “The most successful entrepreneurs are those who adapt their business vision to what customers value – that means what customers will pay for.”
Mistake #4 Taking Blind Advice from a “Franchise Consultant”
Online franchise consultants and life coaches have a sneaky way of luring people into an unrealistic concept. Essentially, they are third party salespeople who have a very limited knowledge in franchising but who receive commission off franchisees. It is quite difficult to differentiate between a real franchise consultant and one who is driven to scam. Relying on a franchise consultant for guidance is a slippery slope to take.
Mistake #5 Not Understanding the Market
Diving into a market with a lack of knowledge and preparation puts you and your capital investment at risk. It is important to do the necessary amount of research to understand the industry, location and consumer better. Having an understanding of every facet of the business is imperative to a company’s growth and success. Public information is made accessible for potential franchisees to further their knowledge and better prepare before they embark on this new adventure.
The biggest advantages that franchisors provide are : a community, experience, business model and a team. The bottom line is that just because acquiring a franchise has so many benefits, doesn’t mean you should go in unprepared. If you plan on opening up a franchise, make sure you take a good look at this list to help guide you! The more informed you are, the more prepared you are to succeed, grow and make a profit.