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Do I need experience of the franchise sector I wish to invest in?
Typically the answer to this question is no, as most franchisors will provide you with all the specific industry and operational training you will need to successfully operate one of their outlets. However, there are an increasing number of ‘conversion franchises’ available now where an individual is either an existing employee of the franchisor who converts to being a franchisee or already runs a competing business, which they then convert to the franchisor’s brand and system.The advantages of conversion are that the premises already exist, the franchisee will need less training, the business will get going quicker as it will already have a customer base and the banks may be more likely to lend money to a going concern. The disadvantages, at least from the franchisor’s point of view, are that the franchisee will come with preconceived ideas or established ways of doing things and may be less likely to follow the system. Some sectors - hairdressing, for example - have franchisors who use all three methods of recruitment.We have clients who insist on new franchisees being hairdressers, clients who convert their staff or competitors to franchisees and clients who only take franchisees who cannot cut hair because they are there to manage the business. There is no right answer, but there is a right answer for every individual business.
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