Have you got what it takes to be your own boss?
For most people, the decision to be their own boss has been the right one. However, before making the move, they have carried out in-depth research not only in the franchise they are interested in, but themselves too.
You’ve decided that you want to become your own boss by investing in a franchise, but do you know what will be expected of you or what is in store for you? The answer is that you may find yourself switching between many roles.
You receive a blueprint for running the business based upon the franchisor’s experience and expertise. They also train and support you, but at the end of the day, it’s down to you follow that blueprint and make a success of the business.
When you launch, it’s unlikely that you’ll be able to afford many employees – if any – to share the workload. Even with a family, you will need to fulfil most of the roles yourself, and that calls for planning, hard work, long hours, patience and resilience.
Risk-assessment is your first key role. Can you afford the franchise? Can you support yourself with working capital while you expand your business? Borrowing too much is as dangerous as if you borrow too little, as you will either be spending too much servicing a major debt when your business is most fragile, or discovering that your working capital calculations were inadequate for sustaining growth during this crucial step.
Strategic planning is essential. Work out where you want to go, how you intend to get there, how much it will cost, where you want to be and what your successive goals will be.
On occasions you will have to present your business plan to the bank so they can see how you are progressing and, as such, you must ensure that you are directing your future stage by stage.
You have identified your targets. Can you achieve them through effective marketing, creating a selling platform for your goods or services? You must understand your market, how your product of service fits in and how to interest people in what you have to offer.
This means devising messages through leaflets or direct marketing that differentiate you positively from the competition.
You will need to handle direct advertising and PR to secure sales leads. The franchisor may assist you with promotional materials, lead generation and national publicity, but in your area, it’s mostly down to you, using your local knowledge, contacts and efforts.
Can you convert your leads to sales? Unless it’s a retail operation where customers come to you, or a franchise that takes on the selling burden, most companies expect franchise owners to mastermind local sales.
Make it count
A good lead is not a sale, neither is a converted lead, contract signed, or invoice delivered – only money in the bank is a sale.
In order to create a positive cash flow, you need cost-effective credit control, ensuring invoices are correct, issued on time and to the right people and that minimal time is spent on chasing payment.
With franchising, you get the benefit of someone else’s experience, expertise, systems, training and support, so generally, it’s a better start in self-employment.
However, it will only work if you are honest about your skills, experience, likes, dislikes, strengths and weaknesses.
Franchise owners are a mixture of manager and investor, employee and partner. You must accept that your ‘independence’ is limited by your contractual obligations to the franchisor – but ultimately, you will be in charge of the whole operation. If you can handle that, you can handle a franchise.
Written by Fraser McKay