Ready for a Franchise? Identify the Top Performers

When it comes to buying a business, there’s no truth that doesn’t require verification.

As everyone knows, if it sounds too good to be true, it probably is. Yet every day the newspaper has stories about people who got tricked into a deal that turned out to be mainly smoke and mirrors.

So how do those “lucky” folks find their way to the good business deals? First of all, luck has nothing to do with it. Rather, it’s about finding out as much information as you can and triple-checking everything you know before you even get started.

Doing your due diligence is the most critical part of the process.

That’s why a franchise presents such a great opportunity because it’s the only type of business in which you can learn everything about its nuts and bolts before you buy.

Not only does it come with a tried-and-true operating system, but it also includes complete training and ongoing support to help you make it past the start-up phase for long-term success.

Federal law requires franchisors to disclose almost everything you need to know. And what’s missing from the Franchise Disclosure Document (FDD) can be learned from franchisees. That means you can find out about all the red flags, upfront costs and whether the franchise has the potential to offer you the kind of income you desire.

In addition, another layer of vetting can be obtained by consulting with a franchise coach or two. Their no-fee advice can help you navigate a gigantic universe of some 3,000 different franchisors.

A good franchise coach can save you precious time by steering you to franchise systems with great track records that you may have otherwise never found.

So, to find a top-performing franchise, start with a franchise coach, then select a few whose business models best mesh with your skills and experience, then start to read the FDDs and call franchisees to get the ins and outs of their businesses.

In the end, you have to decide if you would rather put all your hard work and drive into building a future you can control or sticking with the steady job that may not last the rest of your career.

Stay tuned for Part II: How to evaluate a franchise

Ready to make your dream of becoming an entrepreneur come true?

Get your free evaluation today!

Contact Dan Citrenbaum to help you create the career you’ve always wanted. As a franchise coach, Dan brings years of experience helping people select and buy a franchise or existing business. You can reach Dan at dcitrenbaum@gmail.com or at (484) 278-4589.

© Dan Citrenbaum 2020

Advice From The Field: 8 Tips For Aspiring Entrepreneurs

Going into business for yourself can seem like a daunting option, but people do it successfully every day. So how can you transition from working for a boss to being the boss? Get good advice from lots of people and learn, learn, learn!

Related: Career Changers: Consider A Franchise In 2015Demystifying the process is what I do for people every day. Over the past several years, I’ve successfully counseled hundreds of people on how to get started safely. They had to learn how to choose the type of business that would work for them and how to become a successful owner. They know better than anyone what it takes to succeed. Most have selected franchises as the surest way to achieve success as an entrepreneur. Since most people enter the business with no experience as a business owner, a franchise offers years of expertise and back room support to help you get started. Over time, I’ve collected some of their best advice for people who want to follow in their footsteps. So if you want to go into business for yourself, I suggest you read on and heed their wise counsel.

8 Tips For Succeeding With A Franchise

Look before leaping

Every year I hear lots of stories about people buying franchises because they always loved that particular business or always wanted to start a bakery because they loved to bake. Then with nary an iota of research, they sign a contract. Maybe they realize the franchisor is new to the business, or doesn’t really know how to help them get going, and they start to feel like they’re drowning in debt with no earnings in sight. Plan to spend two to three months researching businesses.

Cast a wide net

Once they start their research, invariably people learn the business they thought they always wanted isn’t really the right one for them. Either because the franchisor isn’t well run or because there are no nearby territories available. The truth is you should look for businesses with an open mind because you never know who’s behind the operation until you pull back the curtain.

Consult a franchise coach

Talk to one or more to help give you a feel for the franchise environment, what should be expected and what is a no-no. Their services are generally free, and they can help you avoid wrong turns along the way.

Look for a great back office

One of the most important considerations is how well the operation is run. The best way to find this out is to have pointed conversations with executives from the franchise, as well as franchisees all around the country. In addition, you will need to read the Franchise Disclosure Document, which will provide information on everything, from the backgrounds of the executives, whether they face ongoing litigation to a complete list of upfront costs. Are you comfortable in your gut with how they run their business?

The first year is the most important for support

You need to learn from franchisees whether the franchisor’s support system is sufficient to help you learn the business, particularly at the beginning. Are they available whenever you call with questions? Is their software sufficient for managing the system? Do they help with accounting, advertising, leasing space? Know all upfront before signing any contracts.

Expect a slow start for cash flow to get going

As you learn a new business, it takes a while to get all the systems up and running. Depending on the business, it might take months – or even a year or longer to reach profitability. Plan for this by having enough capital to keep you going past the start-up phase. Sometimes cash flow starts growing quickly, but sometimes it takes awhile. Be mentally and financially prepared!

Talk to existing franchisees

Nothing is more important in your search. Talk to franchisees who have left the business, as well. Interview as many as you can, and press for as much detailed information as possible.

Know upfront what it takes to be successful

Are your skills comparable to the skills the successful owners had when they got started? Can you learn this business in short order? Is the day-to-day life of the owner of this business something you can see yourself doing and enjoying?

Be comfortable with the upfront costs

As one franchisee I know told me, “When people say why not just do it on your own so you don’t have to pay royalties, ignore those people.” You should get what you’re paying for, and good franchises provide a good value. If you select a franchise because you decide it’s a great operation, by all means, follow their advice about running the business. Or don’t do it. 

Ready to make your dream of becoming an entrepreneur come true? Get your free evaluation today! Contact Dan Citrenbaum to help you create the career you’ve always wanted. As a business coach, Dan brings years of experience helping people select and buy a franchise or existing business. You can reach Dan at dcitrenbaum@gmail.com or at (484) 278-5489.  

Is Fear Stopping You From Achieving Your Dream Of Owning A Business?

Successful entrepreneurs are really not so different from you and me. They demonstrate an indomitable work ethic, a belief in their own vision and a drive to do what is necessary to succeed. What separates the successful from the also-rans is a willingness to learn as much as possible before plunking down any of their hard-earned money. So how do you join their ranks? Choose good mentors, who can guide you over the bumps and avoid some of the pitfalls on the road to success. One way to connect with a mentor is to select a good franchise, whose system comes with long-term training and guidance from people who teach you how to run the business, stand by you all along the way and have your back for the long run. The key is to select the right franchise. To find your way to the right match, you have to commit the time to learn everything you can about your potential new business. The good news is that this learning process is within everyone’s grasp. One of the first steps in the process is to interview yourself. What do you really want to do with your career? This process can be a lot harder than it seems. But the sooner you pinpoint your goals the better you can figure out how to get there. After you make some honest decisions about your strengths and your weaknesses, your personal goals and your skills, you must commit to doing a thorough due diligence of the market and the franchise businesses that interest you. You want to do a thorough examination of every business you consider, which will take time, likely, several months.

6 Steps To Doing A Thorough Due Diligence

1. Read

Talk to as many people as you can about what it takes to succeed in business. Regularly read the business section (if you’re not already doing so), a local business weekly magazine, and get a feel for trends in the marketplace, what types of businesses are on the uptick and which may be relegated to the ash heap of the old economy. Of course, the next new thing may not be on anybody’s radar yet.

2. Explore

Start perusing the types of franchise businesses that are available. You might be surprised to learn that nearly every business category is represented, from service businesses, like caring for seniors, to B2B services, such as temp staffing, as well as the most well-known food franchises. Check out the International Franchise Association web site at www.franchise.org

3. Contact

Call the franchise companies that interest you. Most have regional representatives who will answer your initial questions.

4. See

Visit some of these franchises in person to get a firsthand view of how they function. Interview as many franchisees as possible to see how they’re doing. Do they think the franchisor has been helpful? Are they making any money? What’s the key to succeed in that business?

5. Study

If you’re still interested in the business, get your hands on the Franchise Disclosure Document, which every franchise company is required by law to provide to interested franchisees, and read it thoroughly. You can find a list of franchisees in the FDD.

6. Visit

If you’re still interested in the business after completing these steps, you will proceed through the process the franchisor has set up for potential franchisees. This will include meetings with the executives of the company at a Discovery Day, where you visit the company’s headquarters, meet the team and see for yourself what the business is all about. If your due diligence leads to a selection, you will also want to consult with independent experts, such as a franchise attorney and an accountant to check through the details of the financial arrangement and the franchise agreement. The more thorough your research, the greater the odds of your success. So if you want to succeed in business, by all means move forward, just start with a thorough due diligence. 

Ready to make your dream of becoming an entrepreneur come true? Get your free evaluation today! Contact Dan Citrenbaum to help you create the career you’ve always wanted. As a business coach, Dan brings years of experience helping people select and buy a franchise or existing business. You can reach Dan at dcitrenbaum@gmail.com or at (484) 278-4589.   

How to select a top-tier franchise

Franchising is big business that keeps getting bigger, and there’s lots of money to be made — that is if you know where to look. The trick is to hitch your wagon to the fastest, strongest horse!

That means you have to screen out less than ideal businesses to find the right one with the sure-fire system.

Most of the information you would need is available either in the Franchise Disclosure Document (FDD), which all franchisors are required by federal law to disclose to potential franchisees, or through the interviews you should do as part of your due diligence.

So whatever you do, don’t sign any contracts based on superficial knowledge. Your research should go deep and should include advice from the experts.

What Everyone Should Know About a Franchise before Signing a Contract

Litigation History

If a franchisor has been the object of numerous lawsuits from disgruntled franchisees, walk the other way. This history is easily discovered in Item 3 of the FDD. A simple Google search might dredge up more detail, but remember, just because you read it online doesn’t make it true!

Track Record

Ideally, the franchise you choose should have plenty of franchisees operating successfully for a sufficient period of time. They are the folks, after all, who will be perfecting the franchise system and helping you succeed with your business. Look at the list of outlets, Item 20, in the FDD. Where are they and when were they established?

All Upfront fees

These would include an initial franchise fee, and costs to start up the operation, marketing fees, the cost to buy any equipment you need, build out a location, hire employees, and sign a lease. You also want to factor in the cost to consult an attorney and an accountant. If the numbers appear unaffordable, you shouldn’t sign because one of the biggest causes of business failure is undercapitalization. All costs are listed in the FDD, Items 5-7.

A Franchisees Obligations

If you don’t agree with all the expectations for how you must operate, this business is not for you. Find this information in Item 9.

Renewal and Termination Procedures

The franchisor is also required to detail how a franchise can be terminated or ownership transferred or renewed. Know these details upfront, because there will come a time when you want to sell either to retire with your hard-earned wealth or for a tidy profit. Advice from a franchise attorney is well worth the cost.

Why franchisees have left the system

With the list of outlets in the FDD (Item 20) you also get contacts for franchisees who have left the system in the last three years. Call them and find out why. If you learn about a pattern of neglect you might want to back away. Just remember, sometimes the fault lies with the franchisee, and don’t just take one person’s word.

What current franchisees say about the franchisor

Interview current franchisees. What works for them? Are they making money? Are they happy with the business? Would they make the purchase again?

While your research may take some time, and expert advice may add some expense, the payoff is in choosing a great franchise that gives you the life and the living you always wished for and that works for you in the long run.

Ready to make your dream of becoming an entrepreneur come true?

Get your free evaluation today!

Contact Dan Citrenbaum to help you create the career you’ve always wanted. As a franchise coach, Dan brings years of experience helping people select and buy a franchise or existing business. You can reach Dan at dcitrenbaum@gmail.com or at (484) 278-4589.

© Dan Citrenbaum 2020

Tired Of The Same Old Same Old? Try A Franchise!

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Are you cruising along in a job that you can do with your eyes closed, maybe even with your hands tied behind your back? Everything is humming, and your industry seems solid. Then, bam! Something happens that shatters all your old assumptions and you start to wonder, what are my options? That’s what happened to Dennis Clouser, of Tampa, Fla., who, as a mechanical engineer, had spent 30 years in the electrical connector industry. His last job with the billion-dollar company ITT Corp. ended abruptly after his division’s largest customer, a military contractor, pulled its business once the federal government imposed massive across-the board cuts as part of “deficit reduction sequestration” in early 2013. At the age of 51, Clouser received a six-month severance package, and the company made classes available to him to help him figure out his next stage. One of those classes introduced him to the option of a franchise. Before long, Clouser lined up another job doing exactly what he had been doing for 30 years. But doubts soon started creeping into his mind. “I thought, is this it?” Clouser recounted. “The hell with it. I’ll take a chance on myself for once instead of doing what I’ve been doing until I die. Maybe I can do something different.” He had a couple of friends with franchises, and he thought, well, if they can do it, maybe he could, too. With the help of a franchise coach, he started doing his research. “101 Mobility really grabbed me,” he said, referring to the franchise that sells mobility equipment, such as stair lifts, auto lifts and ramps to help people with disabilities stay in their homes. “I could help people instead of making bombs to blow them up.” Clouser felt a personal connection to the mission of helping people deal with their mobility issues around the house since two members of his family had suffered amputations that resulted from complications from Diabetes. While Clausen was confident about his mechanical abilities — “I can put anything together” —when it came to the other aspects of running a business, from bookkeeping to managing payroll and benefits, he felt less sure of himself. That’s where the franchise company’s support really came in handy. “101 is fanatical about opening steps,” he said. “There are biweekly meetings with people in corporate” where they discuss everything from finding a location, negotiating a lease to paying taxes. “They manage you every step of the way,” he said. “I wouldn’t have been able to open without learning what I learned from them.” As part of the preparation process, he talked to franchisees, some of whom were more helpful than others, but he finds the idea of sharing one’s experiences one of the most compelling aspects of having a franchise. For example, he particularly likes the franchise’s new program, “Talk to a Franchise,” where he, now as an existing franchisee, talks to three or four potential franchisees on the phone, and they get the opportunity to ask him whatever questions come to mind. “I’m really blunt with them,” he said. For starters, he tells them starting up a franchise is a lot of work. After two years with his new business, while he acknowledged making some mistakes along the way, he would definitely do it again. The difference is now he’s got total control of his life. And while he knows he may be working until 9 p.m. doing an evaluation of someone’s home, if the water sparkles particularly bright one sunny day, and an empty parking space beckons from St. Pete’s beach, he knows he can take an hour for a swim if he feels like it. Not a bad living. Not bad at all.

Ready to make your dream of becoming an entrepreneur come true? Get your free evaluation today! Contact Dan Citrenbaum to help you create the career you’ve always wanted. As a business coach, Dan brings years of experience helping people select and buy a franchise or existing business. You can reach Dan at dcitrenbaum@gmail.com or at (484) 278-4589.