Following a pandemic-driven period influencing the boom in today’s economy, many franchise-owner aspiring individuals are questioning how to best prepare to purchase one. While a few elements have shifted in light of the pandemic, the same crucial preliminaries still hold-it’s just a matter if you decide to do them. To better position you on a path toward future success, you must complete and review your homework before purchasing a franchise. Here, you will find benefit with a working checklist to help you determine if you’ve done everything necessary before you invest.
A checklist that will help you lower your risk.
Here you go!
1. Have you learned all you can about the franchise concept?
2. Do you feel that all of your questions were answered by corporate?
3. Did you get enough insights from the franchisees?
4. Did you attend an in-person or virtual Discovery Day at franchise headquarters?
5. Did your Discovery Day provide you with enough information on the company, its culture, and its support structure? Do you trust the executives?
6. Have you looked at a couple of different financing alternatives?
7. Did you seek out and meet with a franchise attorney?
8. Do you have money in place to live on* (household expenses) for 6-12 months-during the lean times of your franchise business start-up period?
9. Have you thought about a worst-case scenario? What if your business fails? How much money will you lose? Can you recover?
10. Are you ready to put in the hours necessary to be successful?
Have You Done The Work?
That’s what this post is really about. The work.
You wouldn’t believe how many franchise buyers don’t do the work. Too many skip even the most basic parts of investing in a franchise.
For example, did you know that there are people buying franchises right now-signing 10 year franchise agreements-who aren’t having a franchise attorney look them over? Why would a potential franchise owner do that?
For one, many franchise sales representatives tell prospective franchisees that “You can hire an attorney if you want, but it’s not like they’ll be able to change anything in the franchise agreement.”
DO NOT fall for it! Even if zero areas can be changed, it doesn’t matter!
The main reason to hire a franchise attorney is to protect yourself-this includes a detailed review of the 300-page Franchise Disclosure Document (FDD), and the franchise agreement. Why? To provide thorough understanding of the terms of the agreement, including what the franchisor is responsible for and what you are-as a franchisee.
Plus, do you really want to pour over pages and pages of legal terms, some of which only a lawyer can understand?
Make A Commitment Now
At MCDA CCG, Inc., we want you to make a commitment NOW.
Before you sign a franchise agreement, before you reach for your checkbook to invest in one, utilize the checklist we created above.
Then, if you still have questions, if you still aren’t 100% of the way there, we want you to schedule a complimentary call with us. Why?
Because buying a franchise is a big deal.
Located in Placentia, California, our business advisory team here at MCDA CCG, INC. are motivated by the success of our clients-people just like you. With industry leading, actionable solutions to assess and reinforce your position, we are happy to assist you before you take the leap in purchasing a franchise.