10 mistakes to avoid when starting up a new franchise
More people than ever before are learning of the benefits of becoming part of the franchise industry, and it can be an exciting and financially rewarding time. However, as with starting anything new, you will need to avoid making those rookie mistakes that could harm your business. In this article, we will take a closer look at some of the mistakes to avoid when starting your new franchise business, whether it’s an automotive franchise or a pet franchise, or whatever business you’re interested in…
1. Not securing enough finance
Most new franchise owners will not have enough of their own money to fund their new franchise, so securing financing is going to be vital to get your franchise UK business off the ground. Not only will you need money for start-up costs, but you will also need to factor in finance to help you and your franchise business through the first year.
2. Not taking advantage of the support offered by the franchisor
Now that you have your franchise up and running, it may be tempting to just go it alone, but one mistake new franchise owners often make is to ignore the help and support offered by the franchisor. The franchisor has the experience and the knowledge to help your fledgling business with regular support all through the year and not just when you launch your new business.
3. Failing to follow the rules set by the franchisor
Because the franchisor has to deal with the worry about brand image, they often set out a number of rules that new franchisees have to follow in order that the business provides consistent products and services of the highest quality. Not following these rules or guidelines can lead to mistakes that can be harmful not only to your franchise but to the brand overall.
4. Failing to do enough research when selecting a franchise to run
Most people who are new to franchising often opt for a business that they either have a passion for or have become a loyal customer to. However, opting to sign up for the first franchise that fits in with your interests or experience could leave you owning a franchise that is not 100 percent suitable for you. You may find out later down the line that your area of operation is miles away from where you live, or that the support from the franchisor is all but non-existent. Either way, it is vital that you research several franchise opportunities prior to making your final decision.
5. Not making use of a franchise consultant or lawyer
The world of franchising is an exciting one, but it is also a complicated one for the inexperienced. There is going to be many legal forms to read and sign before you can get up and running, so acquiring the help of a franchise consultant or lawyer will be beneficial to guide you through the legal minefield.
6. Deviating away from your business plan
Prior to joining a franchise program, you will be requested to lay out a detailed business plan, which will play a vital role in how you run your business. A business plan should be your step-by-step guide to success, so deviating away from it could lead to a number of problems that could take your business in the wrong direction.
7. Ignoring the importance of marketing
Just because the franchisor has a thriving business with plenty of customers doesn’t mean you should ignore marketing your product or services. You will need to develop a strong customer base in your area of operation, and this can only be achieved by diverting enough time and money to a successful marketing campaign.
8. Taking on more customers than you can adequately handle
Although a strong marketing campaign is vital to attract new customers to your franchise, you need to make sure that you do not overreach yourself by taking on more customers than you can handle at once. If you have too many customers and not enough staff it could lead to disaster, with stressed out and overworked employees and customers whose satisfaction levels are low.
9. Thinking you’re infallible
It doesn’t matter how much education or experience you have, you are not infallible, and if you try to run before you can walk then you’ll end up falling flat on your face. Don’t be shy about taking advice and recommendations and don’t worry about owning up to making a mistake, as it will help you in the long run.
10. Expecting your franchisor to do most of the work
Although you should expect support from your franchisor, don’t be one of those business owners who thinks that the franchisor is there to do the daily grind too. If doing the hard work is too much for you then franchising is probably not for you and don’t forget, it is your responsibility to attract new customers to the business in your area of operation.