Thinking about starting a franchise? Congratulations! It’s an exciting step, one that can provide you with greater professional and financial freedom and a more meaningful legacy for your family. At the same time, however, it’s important to have realistic expectations about the process.
My goal as a franchise consultant is not to paint a rosy picture that tricks you into becoming a franchisee. It’s to match potentially successful franchisees with the right franchisor – and if I send franchisors a bunch of candidates who aren’t actually suited to the role, my consulting business will fall apart pretty quickly.
As a long-time franchise owner, I obviously love this business option. In fact, I often say it’s the best career decision I ever made. But my personal experience – not to mention all the franchise candidates I’ve coached – also means that I have a realistic understanding of it. My goal is to pass that understanding along to you, so you can make an informed decision about whether this is the right option for you and your family. As you decide whether to become a franchisee, then, here are some key things to expect about the process of launching a franchise business.
Starting a Franchise is a Big Investment
You probably already know that starting a franchise is a big financial investment. Next to – or perhaps even beyond – purchasing a home, purchasing a franchise will probably be the largest financial investment of your life. It’s important to be honest with yourself about the significance of that decision. Starting a franchise is a financial tradeoff. You won’t be able to pay yourself a salary right away, so you need to think carefully about how you’ll pay your bills in the meantime. (One popular option for dealing with this: keep your day job and operate your franchise as a side hustle, like I did, until it’s profitable.)
In addition, the money you invest in your business will not be available for other purposes, such as retirement, traveling, paying for your kids’ college, or remodeling your home, so you’ll need to weigh those goals against your franchise decision. However, the exciting thing is that a successful franchise can ultimately help you build wealth for yourself and your family, often well beyond what you would have earned in a corporate role.
Starting a Franchise Involves Delayed Gratification
That brings me to my next point: you shouldn’t expect immediate return from your franchise investment. It takes time. How much time depends on various factors: the type of franchise you purchase, the size of your initial investment, how much you want to grow the business, and so on. I can help you figure out what your timeline might be.
The good news: you have a lot of influence over your rate and speed of return. When you invest in starting a franchise, you essentially invest in yourself. This is a very different scenario from working in the corporate world, or even from managing a traditional retirement portfolio. In those situations, you have minimal control and limited options for changing course. But with franchising, you run the business, so you can make any adjustments needed to increase your chances of success.
Starting a Franchise is Hard Work
I’ll be honest: starting a franchise is challenging. But it’s a good kind of challenging. If you’re an experienced executive, being your own boss will work new parts of your brain. You should plan on spending a lot of time researching franchising in general, and your business’s sector in particular.
Then, you should be prepared to spend a lot of time getting the business off the ground. You’ll need to oversee setup, whether that means building out a physical space for a brick-and-mortar business, or making sure you have all the equipment you need for a home-based business. You’ll also need to ensure you have all the necessary paperwork or certifications for your business, potentially hire your first employee, attend the training required by your franchisor, and likely work in the business when it first opens. You can certainly do all this as a side hustle, but you probably won’t have much free time for a while.
Once things are running smoothly, however, franchising gives you the chance to operate on your own terms. You’ll get to a point where you can set your own schedule and enjoy the return on your investment. If you opt for an executive franchise, you can even bring in a full-time income with just 8-10 hours/week of work. Work will become something you do because you enjoy it and love the mental engagement, not a grind or a rat race that commands 60 hours/week of your time.
If you’re ready for an honest, realistic assessment of franchising, book a call with me. I’d love to help you figure out whether it’s right for you!
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