There are three main reasons why it might not be, David Banfield, president of the interface financial group, explains
The world of franchising is constantly expanding in size, complexity and diversity. Gone are the days when franchising only embraced fast food with high street locations. In today’s environment there are literally thousands of franchise concepts available to the would-be franchisee.
On the face of it, therefore, it should be easy to match the right franchisee and the right franchisor. This, however, may not be the case, due in part to the enormity of the franchise marketplace.
Not every franchisee candidate is a natural fit for a franchise environment, regardless of their thought process. There are three main reasons why franchising may not work for an individual. While these are not the only reasons, they represent areas where many potential franchisees fail the test.
ALREADY DOING IT’ SYNDROME
This relates to the fact the franchise market has become so diverse that virtually every type of business and business model is franchised in one form or another. Many individuals often see themselves as franchisees of a particular brand because they have, in a past or present life, been doing exactly what the franchise offers.
The biggest hurdle here is that the individuals in question have usually been doing ‘it’ as a hobby. They firmly believe that as a long-time hobbyist they know all the ins and outs of the process, require minimal training and are already well on their way to instant success under a brand name. The reality invariably proves that they are quite unsuitable for the franchise, regardless of the fact they have some knowledge of the service or product.
Running a business and having a hobby are two very distinct and separate situations. As a hobbyist, you have no structure, timelines or reporting responsibilities and certainly no bottom line requirements. A franchise, by definition, is a system that has to be followed in all areas on a day-to-day basis. Regular hours and work ethics are required components. Hobbyists, on the other hand, can stop and start when they please and even walk away from a project for a week or two with no adverse effect. Franchisors expect more of their franchisees, as they have a brand to maintain and service standards to meet.
Rarely can a person who has been even a keen and devoted hobbyist convert to a franchise environment, with its guidelines and structure. If you are thinking of turning your hobby experience into a franchisee situation, think again and look carefully at all of the ramifications involved.
They have had long and exceptional careers in large companies - many may have spent decades working for the same one. To find themselves on the move and potentially becoming self-employed represents a serious leap of faith. For those who are looking at that option and thinking of perhaps a home-based, one-person enterprise, theirs becomes a quantum leap of faith.
In any corporate setting, employees of long-standing understand the structure of the business they work for. They report to someone and others report to them. There are specified times to do certain things, complete projects, plan and budget, all driven by the corporation. It is a well planned and disciplined organisation. It has a social side, with appropriate safety nets to deal with problems and issues all well established. It also has a community aspect to the business, as one is working in a company with maybe hundreds of other employees.
Notwithstanding that a franchise is also a very organised and detailed business, in a one-person business many of the organisational aspects just do not apply. Likewise, there is no ‘coffee machine’ for social chit-chat and the like.
The lure of working in your jeans and a sweater may be a big enticement after years of commuting or being part of a high pressure team, but look beyond the immediate benefit to the bigger picture. It takes a certain type of disciplined individual to be a successful one-person, home-based entrepreneur. If you are a social creature, then maybe you should think again about the lure of wearing jeans to the office every day.
IT’S A FRANCHISE, SO IT MUST BE SUCCESSFUL
Franchising has a long and envious record of success. Over the years we have seen franchise brands grow and grow. That growth must surely translate into success for the franchisees and franchisors alike. Many individuals start their discovery journey into franchising with a preconceived notion that if it is a franchise, then that spells instant success.
The reality is that a brand, no matter how well known and prominent it is, can sustain failed locations. This usually happens when the franchisor does not apply its usual stringent review process to would-be franchisees.
With an established brand, if a failure occurs it is invariably nothing to do with the brand, but rather the franchisee in a specific location. Because this is a problem to be avoided at all costs, franchisors continue to be vigilant in ensuring their franchisees are under no illusion that being a franchisee is hard work or, at best, smart work.
It’s short-sighted for individuals to think they can be awarded a franchise of their choice just because they have the financial resources. There has to be an underlying solid work ethic that will bring success to the business. Even though the franchise concept has been proven, maybe over several decades, it is still not a silver bullet to success. Individuals who think franchising represents the easy way to business prosperity should become more acquainted with the requirements needed to create a lasting success story.
Franchising is a great vehicle for individuals to accelerate their learning curve through a proven model. However, the bottom line is that it is not a hobby, it requires self discipline and hard work will always be a key factor in your success.