You should take steps now to ensure that your business is prepared to cope with unexpected waves, no matter what the current climate, says Matt Ball
Tough times can be just around the corner for any business, no matter how profitable or well established. A major new competitor, media controversy, disruption in the supply chain and even a global pandemic count among just a few of the varied and unpredictable threats to your bottom line, but thousands of UK businesses have not only faced – but weathered – these storms in recent times, showing innovation, resilience and even growth.
In good times and bad, the protection and expertise offered by franchisors can be the difference between a thriving balance sheet and looming disaster, so at times when it feels like the world is out to get you, it’s important to know where to look for help.
The good news is franchisees are not entirely powerless to plan and prepare for the unknown, and just taking a few simple precautionary steps can limit the damage caused by damaging curveballs.
1. Know your team
Most business owners will tell you the same thing: the strength of the people around you can make or break your organisation.
The right people can not only help your firm to thrive during the good times; they can also help you to make it through difficult patches. In the same vein, the wrong people in the wrong roles can become a dead weight that prevents growth or even accelerate failure.
Knowing exactly who you have on your side – and their strengths and weaknesses – can be your ace card when troubles come your way. You need to know who will rise to the challenge and who could get left behind.
2. Don’t be afraid to take advice, but be careful
When faced with a situation you haven’t encountered before, it’s only natural that you might want to seek counsel from those you trust. It can be incredibly helpful to learn from other people’s mistakes and to listen to their best practices.
But while most people mean well, it doesn’t necessarily mean their advice will be the best thing for you to do. Be careful what advice you take and from whom, and make sure you are totally at peace with whatever route you decide to take.
Each situation is different, and only you know in your heart what the best options are for you and your business.
3. Make the most of your franchise family
Storms come in all shapes and sizes, and perhaps you’ll encounter one where it doesn’t just affect your business, but the wider circle of your franchise.
In this case, it can be a good idea to lean on the support of your fellow franchisees as well as your franchisor.
You could be going through a shared experience where the immediate path is not clear, and this is where a helping hand could be a lifesaver.
Ultimately, you are all going through a similarly rough ride and you all have the same end goal. Maintaining an ongoing dialogue with your wider franchise family means you can identify problems – and solutions – more effectively and help you overcome the challenges you all face.
4. Be cautious when seeking financial support
There might come a time when you need to secure short-term, or even long-term, financial help to pay bills, fulfil your franchise fee or to make a much-needed investment. The key here is to be careful with the source of your helping hand, as choosing unwisely could end up making the situation worse.
Some banks may offer franchise finance, while your franchisor might be able to help with a deal, such as delaying your upcoming payment. You might even be tempted to dip into your own pocket or to secure finance against your own assets, such as your home.
As with everything, it’s vital to be aware of the potential pitfalls so you know exactly what could happen if things don’t work out.
5. Keep an eye on developments
While it can be very difficult to predict what’s coming over the hill (who would have foreseen the COVID pandemic 12 months before it struck?), you can give yourself the best possible chance of being ready for any changes.
Monitoring the news, speaking to customers and chatting with fellow businesses will put you in the picture when it comes to emerging trends and challenges.
Maybe there is some emerging technology that could put your sector under threat. What about a new piece of legislation that will increase your costs or force you to secure licences?
But it’s worth noting that change isn’t always negative. Keeping on top of developments will also help you see business opportunities before many others and will put you in a great position to take advantage of them.
6. Know when to grow
If things are going really well, it’s natural that you might start thinking about expanding your business and opening more sites.
However, be wary of not overstretching yourself, as this will compound the problem if a problem hits. Expansion for expansion’s sake might not be the best idea, as it can make it even more difficult to weather hard times.
You should always ensure that you have the right financial backing and good support from your franchisor in place before making a big commitment to expand.
7. Choose the right franchise
Above everything else, choose a franchise that’s right for you. Passion can go a long way when times get tough. Often people will tell you to leave emotions at the door when starting a business, but following your head and your heart is always a good idea. By picking a business you’re passionate about – and making sure that the numbers stack up – you can look forward to building a future that’s both emotionally and financially rewarding, regardless of any stumbling blocks along the way.
Matt Ball is the founder of the inflatable theme park franchise, Inflata Nation, which has nine locations across the UK.