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Ezine Ready

New Franchise Opportunities

New franchise opportunities in the UK are coming available on a weekly basis, with the explosion of franchise consultants on the market franchising your business has never been easier. But what make a good business to franchise and what makes a good franchise to buy into?

Firstly it has to have a proven business model and this is where many franchises fail their franchisees. I call them "Made To Franchise" businesses and these are there to take the franchise fee + a monthly % of profits or a licensing fee, a lot of the time these ready meal franchisors do not care at all about the franchisee and make claims of huge profits over short periods of time, although there can be certain scenarios where this works it is often the case that the franchisee makes loses and over time the system as a whole will fail with the franchisors leaving the existing zees ridden with debt. Made to franchise businesses who go in without a proven business model are not a good franchise opportunity to buy into.

When a new franchise comes onto the market they should be looking to set up several pilot franchises and run them over the course of a few years, establishing that their system works and working closely with each zee. As a prospective franchisee looking at a new franchise on the scene you should be asking some choice questions:

1. How long has this franchise opportunity been on the market?
2. How many existing franchisees are there?
3. Am I one of the pilot franchises?
4. How long was the business model running before they franchised?

The most important question there is number 4. If the business has only been up for a year or less before they franchised then you are buying into a made to franchise business, a ready mealer. This is not necessarily bad news though as with the right people running the operation this could be a new, exciting and profitable opportunity, however in a lot of cases this is not true and you could be buying into a failing business model.

There are many franchises opportunities out there, old and new, when buying a franchise the first thing that comes to mind is that you are buying into an existing, established, reputable business, and most times you are but... In America and Canada they call it "Due Diligence" This is where the onus is on you to do a thorough investigation of each organisation you are looking to buy into. Do not be bullied or conned into buying a franchise by the franchisor, do not be fooled into believing you will make £200,000 in your first year, go away with the facts they have given you and investigate. Contact existing franchisees and use the Internet to search for any bad reviews. Post messages in forums asking what people think and do Google searches. Websites like Rip Off Reports can give you a valuable way of finding any bad reviews by ex franchisees, remembering though that an ex-franchisee may give a bad report where 10 current ones are making a success of their franchise.

When buying a franchise opportunity the choice is yours as to whether you are set up for life or losing your life savings so investigate, investigate, investigate.

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Matthew Anderson is a franchise consultant and founder of The Franchise Shop, a UK business franchise directory featuring everything from Van Franchises through to Internet Franchises and Dating Franchises

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