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Archive for the ‘Franchising’ Category

Over the years, I have a lot of entrepreneurs who are franchising your existing business a success to speak. Who can blame them – the idea of ​​a small business and duplication at the national level, perhaps, are what dreams are made of the entire enterprise. If I am an entrepreneur, looking for the big picture, and I wonder how they decide to talk to franchise your business, I often say that they have long thought and many clients have said. “You must Franchise”

Now this is how it usually starts, and retired as franchisor / consultant, to be honest, I often find employers of this great concept of deterrence. Let me explain. You see, there are many hidden problems in terms of the license, but let me five things to consider here;

1st Many of the capital
2nd Law and Regulations
3rd Disclosure, accounting, auditing,
4th This is an incredible amount of work
5th No guarantee that will be around 5 years

You can not do this, but if you franchise your business have a minimum of $ 1,000,000 in capital to get it right. I wish there were an easier way, but it is not. Work your butt off enough not think so, you have to work hard, but you also need the money, it will not be able to develop the company fast enough cash flow necessary to go to the next step.

Most entrepreneurs and small businesses are particularly love lawyers and government agencies. Small businesses know they need no additional licenses, rules, rights and licenses. Well, if you think the past was bad, wait until you are in the franchise industry. You need to pay lawyers to documents from more than 300 pages, costs $ 35 000, only to put in order to create open and you have to update and revise early and often to avoid prosecution.

Speaking of tests of the franchise industry is fully involved, and it is very regrettable. But it is also the reason why huge material, including audited financial statements. On the other hand, those who are not cheap. Many states require registration in its audited financial statements 90 days before the renewal requirements. And with your registration renewal time synchronization, because the state bureaucracy, cuts, extensions and new regulatory requirements that do not even mention to your attorney at the time, not at the mercy of the franchise-wide regulatory review state. Believe me, it’s a nightmare, I swear to myself, I guarantee it.

So if you think running a restaurant is hard work, or manage your current business situation and a small number of outlets is difficult when you do not know what hard work is still underway. Once this franchise that never sleeps. And even if his return from work, and even if it adequately capitalized, with more than $ 1,000,000, there is no guarantee he will succeed in the first five years. The failure rate of the franchisor 05.01 – and yes, there are hidden problems in the franchise industry. And it is better to think well and hard before she for him. In fact, I hope you can see this and think about it.

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If the message and do nothing with the franchise through the United States, scan, I do have a number of emerging industry trends. I understand that lawyers speak of the franchise, and I do begin to understand the franchise associations, such benefit to be best educate their members from these future trends. In fact, I’m looking for supervisors to carefully consider a number of new developments game. These are things that happen now and do not appear to show trends in the short term, but long-term changes in the industry.

In fact, as a former franchisor and franchisee advisors, I would like to address these four points, from my perspective. In other words, as I see it all in the perspective of a franchise-business projects in the market with hundreds or thousands of franchises go, and decide as a thinker and futurist, and then if I think my assessment is true. Well, here are four points I may want to address;

1st Social Networks
2nd Payments Smartphone
3rd New health insurance rules
4th Problems in financing the expansion

In 2000, there are no social networks or blogs. There was no SMS smartphones and mobile phones at the moment is as stupid at this time. But I remember the challenges of the Internet forums, as a franchise would give proprietary information without prior notice or dissatisfied customers of a franchise to online brand and all the pain away franchisees across the system.

This was the beginning of a series of challenges. Today, the failure of the franchise to go on the Internet due to viruses, YouTube and social networks within hours, not days, weeks or months. Therefore, many franchisors the need for crisis teams are feeling of social networks. Back in the day, I can remember working on the fire line, if not extinguished, as a point where we feel like it, or if he thought of the hands.

Social networks are now being used by franchisees to customers in their local sites, as well as franchisees to build their brands, is looking for new franchisees to hire, and even discounts and coupons on all sales will account with franchisees. This trend is likely to continue, are also located with a GPS phone alert on coupons to customers in the vicinity where discounts around the corner, if you are interested.

And speaking of smart phones and location-based coupons and warnings for programs that reward customers with specific applications, these customers can pay with their mobile phones. Many large companies already do, and this trend will continue, and you can use any photo or company is franchised retail use service applications in the near future deployment.

Then there are the economic and political issues affecting the franchise. ObamaCare example, and the stage published in 2014, of all employers to offer health insurance for all employees. This is an increase in costs as a burden on the franchisee, the franchise is unique. Leading to a decline in hiring again, and also a reduction in personnel costs. There is also an enormous cost, the profitability of each sale is not only the franchise, but all small businesses in America.

There may be some changes in the law but do not know, and this causes a bit of a problem in the franchise industry scrambling for solutions, and even try to get exemptions from Obama. Some large companies have already received, without exception, and others. The company will not be disadvantaged in competition with the exemption. Many franchisees who could not get the exceptions have to mourn, crony capitalism.

Another problem that has to do with the general economic situation of the franchise, are the future challenges of the availability of funds for the new franchise points, extending the existing franchise and the questions that have signed franchise agreements with the development of their franchisor. Well, if interest rates rise, banks may be more willing to lend money, it’s worth the risk, but the money will be expensive for the borrower’s activities. There are some banks lend money to small businesses, including franchise now, but things are not there, where they should be. It is an unfortunate development that looks set to continue. Meanwhile, it will affect the growth of franchise companies and slowing expansion franchise or the opening of new markets.

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