Open or purchase a franchise

If we are thinking of becoming part of a franchise, we must first have an understanding of the associated business formula and how it works.

To this end, we must find out what the essential elements are that comprise a franchise relationship, what rights we will have as a franchisee of a brand, and what responsibilities the franchisor will have towards us.
The former include: relinquishing the use of the brand, the supplying of necessary materials/resources for engaging in the endeavor, regulating the network to attain maximum profitability thereof, and introducing any necessary changes to enable the system as a whole to improve and continue being competitive.

Meanwhile, the franchisee must put into practice the training received from the franchisor, making sure to closely follow any and all guidelines regarding the utilization of the brands and hallmarks of the chain. It is also important that they respect confidentiality as far as the operating of the business is concerned, not engage in unfair competition, and regularly make the payments (of canons and royalties) established in the franchise contract.

Good choice of sector, a fundamental aspect of franchising

We should point out that not everyone has the appropriate profile to become the franchisee of a brand. This is why, after looking into the workings of a franchise, we must carry out a self-analysis of ourselves which will enable us to determine not only our own compatibility to become business associates, but also whether we have the right character to become the franchisee of a brand.

We must then analyze the sector in which we wish to begin. This is done to ensure, for example, that we favor the operation and that it is a market with a growing demand and not solely a passing fad. Another important factor is to ascertain whether the development of the operation calls for certain technical knowledge, and if so, determine whether or not we have it.

After choosing the sector, we must contact the franchise we’ve determined has the most potential. This is the one we find the most convincing and with an initial investment we can undertake with a certain solvency. In response, the head office will send us a commercial dossier accompanied by a pre-selection form on which we must specify our personal and professional details and economic capabilities. The franchise head office will analyze our candidature and if we fulfill the prerequisites they demand, will then summon us to a meeting where we will be given more detailed information and we will be able to learn more about the verification of the model, economic and legal aspects, running of the business, and the structure of the franchisor.
We should contrast all of this with the sources of information at our disposal, from franchise magazines to sectorial guides, trade fairs, and the Internet. Our most important resource, however, is with the people who can best advise and inform us: the franchisees who already belong to the chain.