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A
S T E P
B Y
S T E P
G U I D E
TO PICKING THE RIGHT
FRANCHISE
"With so many franchises to choose
from, which one should you buy?"
The truth is, there is no single franchise is perfect for
everybody. The perfect franchise for your friend may be
too expensive for you if you have a smaller budget. A
popular F&B franchise may not be for you if you don't like
handling food.
In the end, the franchise you should buy depends on who
you are, what you enjoy doing and how big your budget
is.
In this guide, I will show you the step­by­step process to
decide which franchise you should buy. I built this guide
using advice from franchising professionals.
Are you ready?
Let's begin.
Step 1: Know your business
personality
According to Entrepreneur Magazine, performing a self­
evaluation is the first step to choosing the right franchise.
You can do so by asking yourself the following questions:
How many hours a week do you want to work in the franchise?
What are you good at and what are you bad at?
How much money do you have to invest in the business?
How much money do you expect to make from the business?
Where do you want to operate your business from?
Would you like to sell your business in the future?
By asking these questions, you will be able to find out what is
important to you.
Knowing what is important to you can help you weed out
franchises that do not meet your expectations.
Step 2: Know your finances
Buying a franchise is not a guarantee of profit. Like any
business, it can be risky. You can lose all the money you
put into the business if it fails.
So before you buy a franchise, ask yourself:
How much money do you have? Of this, how much
money are you willing to risk?
Are you willing to take out a loan for your business? If
yes, how much? Who will you borrow from?
Step 3: Decide which
industry category fits
your needs
In Step 1 and Step 2, you have
found your business
personality and financial
standing. Now, it is time for you
to choose a franchise.
But before you look at individual companies, first look at
industry categories. These include categories like F&B,
Education, Health, Beauty and so on.
Each industry category has different requirements for
working hours and skill. You should pick the one which
suits you best based on what you found about yourself in
Step 1.
To reduce your risk, choose industry categories that do
well even when the economy is not. These include
industry categories that are necessary and affordable,
like groceries. People will buy them even if the economy
is not doing well.
Step 4: Look at individual companies
Once you have selected the industry category, it is
now time to look at individual companies.
First, look for individual companies that are still
available in your territory. From that list, pick the
companies that interest you and you think might do
well in your area.
Step 5: Request for preliminary
information
By now you should have a list of potential companies. The
next step is to get basic information about what it is like to
become their franchisee.
You can get this information from their websites or by
contacting them. From this information, you can get basic
cost information and other requirements. Pick the
franchises that fit your interest and financial standing. This
will help you to narrow down your list.
Step 6: Talk to existing franchisees
Talk to existing franchisees to get a feel of what it is like
running the franchise day to day. You can ask them
questions like:
How much support does the franchisor give to
franchisees?
How effective are their marketing materials?
And so on.
This step will help you further narrow down your list of
potential franchisors.
Step 7: Visit the franchisor
The final step before making your
decision is to visit the franchisor's
headquarters. Here you can talk to the
franchisor about your concerns and
see how they address them.
Meet with the person who will be
helping you set up your franchise. Get
a feel of what they are like and if you
are comfortable with them.
Step 8: Make your decision
After you have gone through the 8 steps, it is now
time to make your decision. The franchise of your
choice is one that most likely
­ interests you
­ fits within your finances
­ has good reviews from existing franchisees
­ has a team of helpful staff who can support you in
setting up and running your business
­ Once you have decided on the franchise to buy,
take action and move forward with your business.
Note: Of course, it is also possible for you to find out
through this process that you don't want to buy a
franchise. You may find it too expensive, inflexible
or too much work. In this case, feel free to abandon
your idea of buying a franchise and look for another
way to start a business.
This guide is brought to you by
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