How to Evaluate a Franchisor Franchises
To select a franchise business, there are many factors to consider. Starting from understanding the franchise itself, the governance of his franchise, the main points of agreement and the pattern of the franchise contract, the financial aspects to the problem of the owner of the franchise alias franchisor.
One of the tips on choosing a franchise is to look at its franchisor. Here’s a quick review of how to assess the franchisor.
1. How long the franchisor do his business.
Franchisor that we choose must be experienced in the business that he field. Choose the franchisor who has to his business at least for 2-3 YEARS. If he is not a businessman, at least he had worked as employees in the same field more than 2 years and know the management where he worked.
2. There is evidence of success.
In addition to his experience, we need to know is PROOF SUCCESS of the business being operated. At least we should know its financial statements for at least 2 years. Franchisor can demonstrate his success. But remember, we also need to know how to become a man of experience previous. What is the condition of its branches? There is a restaurant that the number of branches explodes quickly, but then fall off one by one.
3. Its products are good and unique.
Choose a company that sells quality products and liked by many people. Items are also the products we choose its growth experience, not products which have saturated the market or industry, although the market is saturated in fact a myth.
4. The system has been tested successfully.
The good franchisor according to Robert T. Kiyosaki, offering BUSINESS SYSTEMS. Buying a franchise means buying the system. Brand is only one key to success. Another important key is the system. This system includes production management, finance, marketing, supply and logistics flow and human resources.
5. Having knowledge that can be transmitted.
Franchisor must have the resources based on KNOWLEDGE.
6. Franchisor must have the spirit and entrepreneurial orientation.
Prospective franchisees need to consider whether the franchisor has proactive attitude, Ability to innovate, and WILLINGNESS TO TAKE RISKS.
7. Track record and entrepreneurial lifestyle brand holder.
8. Open in financial terms.
Ultimately, we must know the company’s performance and critical FINANCIAL SCHEME offered. See if offered reasonable assumptions or not. Look carefully at its Return On Investment.
