Is it just me or is a franchise sounding kind of nice?
October 19, 2023
by an intermediary from University of Georgia in New York, NY, USA
My biggest hold up nearly every time I start to like a particular business is that I'm going to miss something and make dramatically less money in years 1 & 2. I've invested in three deals and the owner/operator is 3/3 in having terrible income personally for the first few years.
With obligations, I feel like I can hedge some of this risk buying in a franchise. The issue is, I believe the best franchise opportunities are gobbled up by other zors. Anyone know good brokers in the space? Best sites?
Thanks!
from Brown University in San Francisco, CA, USA
Opening Up to Franchises to Buy a Great Business
https://acquiringminds.co/articles/doug-johns-mr-rooter
How to Build a Portfolio of 20 Franchise Locations
https://acquiringminds.co/articles/michael-horowitz-wingstop
How a $40k Acquisition Led to a Franchise Empire
https://acquiringminds.co/articles/james-temple-mathnasium
Buy a Franchise Portfolio: How to Choose a Brand
https://acquiringminds.co/articles/aj-wasserstein-michael-horowitz-peter-mistretta
How to Roll Up Legacy Franchises (to $36m/yr)
https://acquiringminds.co/articles/brian-beers-midas
Buying Franchises: A Primer for Searchers
https://acquiringminds.co/articles/wolf-of-franchises
Home Care Business: How to Buy & 2x an Agency
https://acquiringminds.co/articles/jerome-bouillon-visiting-angels
from University of Tennessee in Nashville, TN, USA
Many franchises are essentially opportunities to buy a low-paying job. Others are legitimate opportunities to earn executive compensation with a single franchise operation. However, most of the regularly-available franchise re-sales that I have seen are the former rather than the latter and require multi-unit operations to equate the risk required for my dollars.
Basic questions to ask yourself if you do consider a franchise(s):
1. What are the restrictions on growth (owner-operators only, multi-unit limits, restricted territories, etc.)?
2. What am I as a franchisee truly receiving in exchange for the recurring franchise/royalty fee? [Many franchisees never ask this basic question before committing to become one and regret their decision after they are one.]
3. What lifestyle and compensation do I truly want and what are the franchise model and franchise agreement attributes that will aid and/or deter me from achieving those objectives?
4. What differentiates this franchise from its competitors (short-term), what are emerging trends in the general marketplace (long-term), and will this business survive in perpetuity? [Remember, franchises are 'concepts' that are easy to copy and replicate. Franchise systems are not flexible and rarely shift significantly with technology or trends like independent businesses have to do to remain market relevant.]
I am not a fan of the majority of franchise concepts available but everyone's investment criterion are their own.