Recently I have been heavily involved in the evaluation and possible opening of a franchise business. As a part of this process I have done a ton of analysis, have been interviewing people like crazy and have learned a lot! I’m going to try and go through my process a bit and try to hash out what has happened, and what my thoughts are on how to go about this process. I’m approaching this more from the aspect of a process, rather than my particular process.
Lets start with the concept… Products are great, ideas a amazing but when it comes down to a successful business its all about the systems. Whether your looking to start a mom and pop shop in a little town or create a multi-national technology company; its all about the systems. The systems define whether you have a job, or a business 
So from the start, the concept must be a system that can make your dreams a reality. In my particular instance, I’m looking for a great product, supported by excellent systems that will enable me to begin the process of creating amazing wealth. It will be a long process, but you have to start somewhere!
For me, I want to reduce some of the initial risk of opening a business by using a franchise system. My reasons for this are pretty straight forward.
- Brand recognition
- Tested and proven systems
- A “support” network from your franchisor
- Reduced risk
I’m not looking to be a creative genius that takes over the world in two years; but I am looking to build a great company that can generate passive cash-flow and create the foundation for the future. Using all of that information, I have narrowed my initial field of vision to the franchising world, and to real-estate.
After doing quite a bit of research on different franchise opportunities and finding some friends that are interested we have landed on one particular opportunity that looks promising.
Now that we have an opportunity in our sights – its time to figure out if it really is a good fit and if we should pull the trigger.
Here is the process we have been using so far… First off, after all of the external factors have been analyzed and decided upon, it all comes down to the numbers. If you can’t make money on the deal, you better be willing to loose money for the entire time you have the business open… in other words, don’t do it! For this particular opportunity, we have spent quite a bit of time focusing in on the numbers, possible ROI and how long we really think it will take to break even.
To make sure that we understand the whole thing we have spent time calling other owners, interviewing people and trying to make sure that we have all of our “ducks in a row”… So how do you get to that point… It’s a tough and long road. In our particular case we have been doing as much research as possible, learning about the industry and all of the key items that need to be taken care of to be successful.
It’s important to make sure you have enough information to be comfortable, but at the same time you don’t want to drag you feet too long! It’s a fine line, and one that requires a bit of a gut check!
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