If you’re thinking of buying a franchise, there are a number of things to watch out for.
1. Your mind starts to play tricks. In the excitement of the gathering all of your information, your imagination starts to take over. You might start to lose touch with reality. Keep your feet planted firmly on the ground.
2. Expectations. As you start falling in love with the franchise, you might end up with unrealistic expectations. Things like, how much money you’ll make, the hours you’ll work and what your life will look like. Nothing wrong with dreams, just make sure they’re realistic.
3. Gut Feel. While it’s important to have a good feel for the business, don’t base your decision on gut feel alone. Make sure you look at the cold hard facts. Get them stress tested.
4. Assumptions. There’ll be certain assumptions you’ll need to make before you decide. These will include assumptions about the franchisor, the support they’ll provide, ongoing product development, customer behaviour, plus many more. Verify these assumptions as best you can.
5. Track record of the franchise. This is key. What is their history, what are their plans for the future, how do you fit it in? Talk to other franchisees to gain insights from their experience as it's the best way to find out.
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