People often think of shady multi-level marketing types trying to pry on the weak to make a quick pound from the franchise fee. Some people have the misconception that you cannot make any real money with a business franchise and that a lot of it is just hot air. But there are also some tried and tested models that can help you to create a tangible, profitable business when used correctly.
There are certain things that you should look out for when choosing a business franchise model.
1. Does the franchise have a good reputation?
Google it and if you detect more negative reviews than positive, run.
2. Is the franchise solely dependant on you recruiting other people?
A franchise is a business and the business model should not just entail you signing other people to the business. There should be a valuable product or service attached to it that you can make a genuine income from.
3. Would you personally use the service and are you passionate about it?
As the business owner, your job will be to sell and we cannot sell something that we are not passionate about or that we don’t believe in. A primary part of the buying/selling process is people buying into us as people and if we cannot convince people that we believe in what we are selling, then we are fighting a lost cause.
4. Does the business have verifiable testimonials?
Anyone can write a testimonial, but a good business franchise will have people that you can speak to directly, people who have made it work and not an over-enthusiastic person at the end of the phone, but a real person who is willing to explain how it worked for them and who can give you realistic advice on what to expect.
5. Did a reputable person or brand create the franchise?
The people behind the franchise are very important as the model will be built on their expertise. If the person or brand has had more business failures than success, I would be very wary about the franchise model. Do your research and find out exactly who you are doing business with.
Once the above is applied, it is possible to make a healthy income from a business franchise and to create a business around your lifestyle.
Some other advantages of the franchise model are:
- You have a ready-made business model that you can use almost straight away;
- You have a tried and tested model that minimises your margin for error; and
- You have the capacity to attach yourself to an established brand, thus saving you the time it takes to build a new brand from the ground up.
If you are not a self-motivated person who does not like to play by the rules, then a franchise may not be for you. If you take into account all of the above and practice due diligence, however, then a business franchise could provide you with the answer you are looking for to create another income.
Kurt Won is the co-founder of Sales Partners (UK).