Steps to Take when Starting your Own Franchise

Starting a franchise can carry less risk than starting your own company from scratch, but that doesn't make it easy. There are a few steps you'll need to take to achieve success.

1. Do your research.

Starting a franchise is no easy task, though generally a franchise is easier to start than a single business from the ground up. You want to find a franchise that works best in your area and works best for you. Research the failure rates of each franchise and the demand in your area. For example, in a warmer climate a frozen yogurt franchise opportunity has a good chance of being successful because it will attract customers all year round.

2. Raise your starting capital.

Franchises often require even more capital than an ordinary business -- especially if the franchise has proven in the past to be remarkably successful. The franchise itself has a fee and they want to know that you have enough money either invested or borrowed to keep the franchise open for quite a while. Thus, you'll need to raise a large amount of capital. In general, the minimum amount should be to keep your business afloat without revenue for at least six months.

3. Complete the training.

Virtually every franchise has a training course that you enter into before you actually commit. This training course gives you all of the tools you need to extend the franchise's brand. When you purchase a franchise, you are required to support their existing branding through your company. You will need to follow the businesses existing rules and regulations rather than creating your own from scratch.

4. Scout out your location.

While the franchise will often do quite a lot for you, such as sorting out some advertising and marketing tactics and generating leads, you'll still need to find the perfect location. Often, your pitch and your signed documents will be dependent on this location. You want to do a lot of research into this; not only will the rent be a substantial amount of your overhead, but you'll also need enough foot traffic and accessibility to thrive.

5. Renovate your space.

If everything has gone well up until this point, the franchise will usually give you the go ahead to renovate. Most franchises have incredibly specific ways to set up their shop, and this will need to be followed exactly.

6. Open your doors.

If you've followed the steps above, you'll now be able to open your doors. Opening your doors is an exciting experience, but you should know that success doesn't happen overnight. Don't get discouraged if the first days aren't banner days.

Every franchise is a little different and some have very structured ways of completing a new location. It's best to determine which franchise you're interested in early on and to follow their instructions.


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