Franchise Checklist To Start Car Wash BusinessSpeed Car Wash
- Knowing the industry
To succeed it’s very important that you choose a franchise in an industry that you know pretty well. Your understanding of the industry is very important to judge the value of the business opportunity and to know if the business suits your personality. The ideal scenario is to have a work experience in the franchise that you are intending to buy. Experience in the same industry is invaluable. In case you don’t have an experience then choose a franchise with a proper franchise training course, this is actually a bare minimum requirement for buying any franchise.
- Choose according to your budget
Work out your budget which would be a combination of your savings and finances that you would be able to raise. It’s very important to keep the following things in mind: your venture can be ruined if there is a large amount of finance, even if you are able to get finance, be careful about overburdening your business with a large amount of loan. Also, calculate the entire investment that will be required for the venture which includes the set-up costs and the working capital. Make sure you do not limit your funding only till the franchise fee.
- Check out the franchisor
The above two steps should be able to narrow down your search and should help you to focus only on a particular industry. Now the next step should be to investigate about the franchisor. The very first step should be to through the documentation that the group has provided, but you should go beyond that as well. Try and find out as much as possible about the reputation and financial aid of the franchise. The internet search can provide a lot of insight about the company. Membership with the Franchise Association of South Africa is counted as a plus point in the favour of the franchise.
- Speak to franchisees and ex-franchisees
The next step is probably the most important step in the process. The franchisor should be able to provide you with a fully updated list of the existing franchises and the ex- franchises and their contact details. You can confirm all the assertions made by the franchise group with the franchises; the level of support provided, quality of the training provided, profit in the business and the integrity of the franchisor’s business dealings.
- Investigate the site
Feasibility of the site where you will open your outlet or in case of non-retail franchises the place from which you will operate, is as important as the integrity of the franchise group. You will have to study the market around the site as well as you will have to gain an understanding about the foot traffic, they should be your target clientele. For taking the right decision you should do your own independent research along with the advice from the experts from the franchisors.
- Get the value calculation right
You need to make sure that you are paying just the right amount for the franchise outlet and you should not overpay, whether it’s a new or an existing franchise. Once you are done with market research, you should contact an accountant to check the financial projections and value calculations. Industry specialists are very helpful if you can afford them.
- Get legal advice and knowledge
An agreement will be given to u by the franchisor, this is a very important and crucial document which details the rights and the obligations of the franchisor and the franchise. Get in touch with a lawyer, preferable one with the knowledge of the franchise sector, to go through the documentations, to make sure that it is fair to you and to explain the clauses. While in a legal frame of mind, you should get to know your rights which have been embodied in the consumer protection act.
- Lease considerations
It’s very important to get legal advice on the lease that you will sign with the landlord of the land. Some franchisers may hold the lease of the land, and that can be advantageous if you are able to negotiate on the rent according to your budget. But it has a few disadvantages as well, you may lose some control over the business if the group ever decides to disband as a franchise.
- Think before taking on a business partner
Having a business partner might seem like a nice idea, but do not do that just for the sake of it. A business partner should prove to be advantageous such as he/she should add value, bring capital or a skill that is lacking in the business. Even then make sure that values and expectations of rewards are aligned.
- In the end, it depends on you
Even the strongest of the brands can fail you, if you do not make it work. Just like any other business you need good management skills to make a success of the business venture. And you also need to remember if you are an inexperienced independent business owner you will have to operate according to the rules of the group.