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Buying a franchise

Why lots of people don't

By Joel Libava, President, Franchise Selection Specialists Inc.
They:
1. Received a great job offer
2. Fear of losing money
3. Fear of not producing income rapidly enough
4. Can't get excited about any of the opportunities presented
5. Spouse or significant other is not "on board"
6. Too many restrictions imposed by the franchise

 

Detailed reasons below

All of the reasons above are valid, and I discuss these with my candidates before we even meet face to face.
Try: Some folks are on what I call a "dual track". They are interested in exploring franchise portunities, but are also sending out resumes, and interviewing.
You can lose money in a franchise/business opportunity venture, just like any other investment, whether it is a stock, a rental property, or anything else that has no guarantee stamped on it, like a bank savings account.  
When you invest in a franchise, do not expect to draw a paycheck at the beginning.This is the most difficult part of a career transition from employee to business owner.  I recommend that before you invest in a franchise/business start-up of your own, you have 6-9 months of living expenses set aside. When it comes to excitement, I  tell my candidates not to expect the lights to flicker on and off in my office,  when I offer specific franchise concepts as a possible match. Generally, the excitement builds as you learn more and more about the concepts.  If you want excitement, go to a concert or live sporting event.

The fear part

The acronym for fear is: False Evidence Appearing Real
Try: Before you bail out of the investigative process, get some facts. Facts may not come from your wealthy and well meaning Uncle Bill, and they shouldn't. Facts will come from the franchise company, and the franchisees. The franchisees are in the trenches every day and will be able to tell you the good and bad about the business, and the franchise company.
Also, the laws are there to protect you, as well as it being your responsibility to find a competent franchise attorney. FTC
Some of this should help relieve your F.E.A.R.

 

  • In summation, work with experts, do your homework, and collect data. If you do that, you will lower your risk, and increase your chances of success.
  • In summation, work with experts, do your homework, and collect data. If you do that, you will lower your risk, and increase your chances of success.

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