Should you join a senior care franchise?
A recent report by the U.S. Census Bureau has revealed...
When evaluating a franchise opportunity, you can learn a great deal as to whether the opportunity is excellent, good, or bad simply by asking the franchisor some targeted questions. Whether you are looking into running a manual service, food service, or professional service franchise, the answers that your franchisor provides for the following questions will help in determining if the business is a good fit for you.
Are You Informed About Your Competitors?
The more information that a franchisor knows about the competition, the more effective the franchise can be in commanding its share of the market. When you question your franchisor about competitors within the same industry, you should focus on several key topics. A savvy franchisor will have a firm understanding of who the competitors are, how much of a stronghold each competitor has on the market, which strategies the competitors have used and will use to maintain their market share and which strategies your franchise will need to use in order to improve your own consumer base and profit margin.
You should also feel free to ask your franchisor about strategies for handling any future competitors who may start up a rival franchise. The explanation of potential strategies does not need to be overly specific, however, your franchisor should be comfortable with discussing future competition in general terms. If your franchisor is willing and able to provide insight on current and eventual competitor strategies, then this should provide you with a sense of trust, comfort and confidence in the direction of your franchise. If your franchisor is not approachable or knowledgeable in these issues, then you should take this as a sign to pursue other franchise opportunities.
Is The Market Size Stable?
Because market size is a major factor in the success of a franchise, you should make it a priority to ask your franchisor for detailed information on both the existing stability and the future growth potential of your product's or service's market. A capable and qualified franchisor will not only have gathered research data on the current size of the market, but will also be able to confidently discuss and analyze the data with you. Keep in mind that a non-disclosure agreement may be necessary for you to sign in advance. Before taking on your franchise, you will need to know that the market is sizable and stable enough for you to successfully implement your strategies for targeting consumers. The goal of your franchise is to penetrate the existing market in a manner that allows for future business growth.
Upon receiving statistics on the market size from your franchisor, you should then be able to discuss your approach in regard to opening your franchise. Your franchisor should be forthright in informing you as to whether the market is new, limited in size or limited in growth capability so that you can develop the appropriate business strategies needed for success. By the same token, you and your franchisor will also need to brainstorm about entering a stable and long-established market. Be suspicious of any franchisor who does not place importance on market size or stability when discussing the franchise opportunity.
