You want to open a franchise. Why? You know the brand and love it. You want to bring it to the people around you and know that you can run an amazing operation.
Before you get started, it’s smart to look into the opportunity to see if it’s a good one. Here are three questions to ask before you jump on an opportunity to open a franchise.
What’s the market like?
Look around the local area. What’s the market like? Is there a market for the franchise you want to open? For example, if this is an ice cream store that you’re looking to open in a cool climate, it doesn’t make much sense. On the other hand, if you’re in a warm area and no other ice cream shops are around, you could end up making a lot of money with the opportunity.
What are the royalties?
When you open a franchise, you don’t get all the profits. Take a close look at the contract, so you know how much money you could make after opening. You want to see that you’re getting a high percentage of the earnings and pay less in royalties to the main company.
What is your territory?
Look at the territory where you’ll be opening the store. Decide if it’s an area that is seeing growth or declines in business. You want to see the kinds of businesses that are trending, as well as popular areas, so you open your franchise at the best possible time and in an appropriate place.
These are three questions to ask before you open a franchise. With good planning, this can be a great opportunity.