10 Sure Fire Ways to Spot a Killer Franchise

By: Chris Delacey - Founder & CEO RedHotFranchises.com

 

If you're keen to start your own business but worry about your lack of experience, a franchise is the way to go. When you sign up with a quality franchisor, you get the clout of an established name and all the backup and resources you need to get started. But franchising can be a murky world. And while most franchisors are straight and above board, there are a few sharks in the water. The fact is, not all franchise opportunities or agreements are made equal. Here are ten signs of a killer franchise to help you choose a quality franchise.

1. The first thing to look for is a franchise with a proven concept. This will be a franchise with a proven track record of success. An example of a proven franchise is The Little Gym, the world's leading children’s motor-skill development franchise. This franchise has a record of success dating back to 1992.

2. The next factor that marks a killer franchise is that it offers a quality product. At the end of the day, a franchise is only as good as the product it sells or the service it provides. That's what keeps the customers coming back. So check customer feedback online and look at the product and ask yourself if it’s something you’d buy yourself.

3. Another good sign is if the product is a well-known brand. This is especially so if the brand name becomes synonymous with the product or service in the mind of consumers. So if your friends talk of calling ‘Mr Handyman’ rather than just a repair man, you can be sure this home repair franchise is a winner.

4. A quality product is essential but it's no much use if no one wants to buy it. That's why you need a franchise with a vibrant market. A great example here is coffee. If you get a franchise from Palm Beach Specialty Coffee, for example, you’re guaranteed customers for the foreseeable future.

5. The market should also have growth prospects. For example, baby boomers make up an important consumer segment, so a franchise such as Senior Helpers, a leader in the companion service and personal care industry, looks like a keeper. So keep an eye open for future trends in your industry of choice.

6. Next, your franchisor should provide great training. This should include both

operational training in the mechanics of the franchise and general business training covering vital skills such as book keeping and marketing.

7. A quality franchise provides excellent support. Asking other franchisees and checking forums is the best way to gauge this.

8. One clear sign that a franchise is a killer is the franchisor has a lot of happy customers. The best way to find out is by talking to other franchisees. You can contact them via the phone book or on online forums.

9. A killer franchise comes with real estate and construction assistance. Location is the key to franchise success so finding a site and negotiating a favorable lease are of crucial importance. A quality franchisee will offer a total assistance package for finding the right site for your franchise and also assistance in the construction procedure.

10. Finally a killer franchise company is one that's financially healthy. You can investigate this by examining the audited financial statements in the Uniform Franchise Offering Circular (UFOC) which franchisors must legally provide to potential franchisees.

Chris Delacey is the founder of  RedHotFranchises.com  He has over 15 years experience in franchising both as a franchisor and as a franchisee.  Currently he serves as the CEO and driving force behind RedHotFranchises.com. Visit RedHotFranchises.com to find all the hottest franchises including the best and latest deals for coffee shop franchises.