Franchising.com News for Franchises
Franchising With Family Members Can Be Fraught With Danger Or Filled With Success - It can be difficult enough to get a franchise up and running on your own, or with other operational and investing partners, but it can be downright arduous if family members are involved in the deal. But that's the route some franchisees take and when done properly this management model can provide years of personal and professional harmony. But there are some secrets to making it work. Go in unprepared and you could break up a business and a family.
Financial Guidelines: 6 Tools That Can Help You Boost The Bottom Line - Last time we looked at how unit economics offers a progressive strategy for tracking and managing costs and revenue at franchise locations. It's a tool that has become a necessity to many savvy franchisees, and it's a tool that should be in place from day one.
Measuring And Maximizing Your Roi Is An Important Strategy From Day One - Those pondering a future in franchising face many important decisions. Beyond nuts-and-bolts basics such as raising capital, identifying a brand that fits, and completing the paperwork, are other – just as important – factors to consider. One such topic is what's known as unit economics.
Anyone who has ever cracked open a business school textbook understands that the bottom line of the monthly financial statement of any company should reflect profitability – if the company is to survive. When the numbers are in the black the business is generating more than it's spending. It's simplistic but effective. But there can and should be a more sophisticated approach to operating a franchise in a fiscally responsible way.
Budgeting Skills For Franchisees - Anyone starting out in franchising faces two critical financial hurdles: 1) finding the capital to start, and 2) surviving the start-up years. Both require careful and accurate budgeting – not only for the business itself, but also on the personal side, as most start-up businesses stretch household budgets at the outset and usually play a key role in keeping individuals and families afloat.
Conversion Therapy: Planning To Enter Franchising By Converting Independent Business To A Franchise Brand - It's likely that more than a few people researching franchising are doing so for a completely different reason than those who have been downsized or simply want to own their own business. The backbone of the American economy has always been the hard-working small business men and women who produce great products and services while providing jobs and offering employees a way to support their families. But what happens when a small independent businessperson is approached by – or discovers that - a franchisor is interested in converting their mom and pop business into one of its own franchise units? Well, it's a scenario that seems to be playing out more and more in recent years. Like many other topics we have covered, there is no simple or definitive answer.
Making A List, Checking It Twice - Your franchise plan should include a well-rounded checklist
Joining the world of franchising can be an exhilarating - and often frightening - process. It requires a tremendous amount of research mixed with a bit of intuition and gut feel. To do it properly requires the careful development of a plan of action. One of the best ways to plan for something significant is to create a checklist and make sure that you cover and review each step.
The Specific Costs Involved In Doing Business - Last week we discussed in general terms the cost of starting your own business compared with that of buying a franchise. This week we examine specifics.
Brand recognition. When you open for business, a well-known brand name is a tremendous advantage in attracting customers and putting cash in the register faster than it would take for a new, independent brand. While franchisees usually pay a percentage of sales for advertising and marketing, the collective power of a national or regional advertising fund will buy a new franchisee more consumer attention than most could hope for on their own.
The Cost Of Doing Business - One of the greatest motivators for entrepreneurs is to be their own boss – to make their own decisions and control their destiny. One way to achieve that is to start their own business. They're still dependent on the market and on customers, but at least their successes and mistakes are their own.
Although under-capitalization is often cited as the major cause in the high failure rate of start-up businesses, rookie mistakes also play a huge role, especially for entrepreneurs with little or no experience managing their own business. These beginner's mistakes can be costly at the least, and at worst lead to failure of the new venture. And while passion is a key ingredient in success (in business and in life), it doesn't necessarily translate into the skills needed to run a business and turn a profit.
How To Work With An Operating Partner - So you got the franchising bug. You heeded the calling to go into business for yourself. But you decided you didn't want to go it alone and you've teamed up with an operating partner to launch the new unit. It's now time for a reality check. When you first identified a partner, the two of you seemed to really hit it off. Your personal and business interests and philosophies seemed to blend, your skill sets complemented each other, and your eagerness to "run your own business" was infectious.
What To Look For In An Operating Partner - The allure of franchising can be intoxicating. Many young people (fresh out of college or with very little business experience) see franchising as a logical shot at owning their own business. Franchising can also offer a fresh start following corporate downsizing. So long as the required financing can be worked out in advance and the franchise agreement approved, the next major step is operations. It's where the rubber meets the road.
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