Consider this scenario. There is a business you have been a fan of for years. Then its leaders announce they are going to start franchising. You have been looking to start a business for years. You have the money to do it. Is this the opportunity you dreamed of, or is it a high-stakes game that could ruin your love affair with that brand forever?
Being one of the first franchisees is much riskier than joining a long-established setup. Yet, with those risks come potentially greater rewards.
Here are some issues to consider.
Do you need a lot of structure, or are you willing to adjust as you go?
If you are the type of person who gets upset when someone tells you they are changing things a few months in, then a new franchise might not be best for you.
The franchisor will be as new to this as you, and they will also be learning by trial and error. They will not get everything right, so you need to accept that however much time you spend doing something they requested, you might need to undo it a few weeks later.
Do you love to give feedback and help others advance?
Think of the new franchise as a pilot program. If it’s one you are excited to be involved in, you can help establish things for other future franchisees. You will probably get a lot more one-to-one contact with the bosses than those that join once things are established.
Can you afford to fail?
Weighing the cost of failure is essential in any business, but more so when joining a new franchise scheme as the chances of success are less certain.
There’s a lot to consider when thinking about buying a franchise. Getting legal help to hone the contracts so that you are not so exposed is one way to reduce the risk you face.
NOTICE: This blog is intended solely for informational purposes and should not be construed as providing legal advice. Please feel free to contact us with any questions you may have regarding this blog post.