Limited Risk/High Reward – Every Franchisee’s Dream
Over the past few months, the world of franchising has hit new heights, so to speak. Industries are expanding – especially in the fields of healthcare and in-home healthcare services. So it is no wonder that the questions about a fantastic corporation called, First Step HomeCare, have increased ten-fold.
To briefly recap, this organization began in San Antonio, Texas and has been ranked in the top ten of San Antonio’s home health agencies for years. The expansion to the company was made when First Step opened their second office in Dallas, and began building an even bigger name for being the ‘best’ in providing much needed services to America’s senior citizens.
We know that there are many people out there who look at the risk and rewards when it comes to deciding between opening a ‘mom-and-pop’ small business versus becoming a franchisee of an already established company. This week, we are going to delve into what all of this means for you; what is the best path YOU should decide upon to begin having the career that you want to have and be your own boss.
There are a variety of reasons why most people purchase a franchise as a way to become self-employed, rather than attempt to start up a new – undiscovered and untried business in a rather trembling economy. The biggest reason revolves around the idea that franchises, being developed systems, are far less risky and have a higher rate of success than starting a business from scratch.
When one enters the business realm through a well-established franchise system, a great deal of the guesswork and fear is taken away. The business owner/franchisee is fully trained in what to expect at the onset of opening the franchise, and receives a full education in dealing with both clients and vendors. But evaluation and the thought-process is still very much involved. Because there are so many types of franchises out there, the “value” of an established brand is something that each individual franchise buyer must decide for themselves. Many times, with newer/younger franchise systems, they are willing to give the ‘early’ franchisees a much more attractive opportunity, as there is negotiating leverage for early buyers that will most likely not be there as the system expands. For the franchise buyer who is extremely risk averse, this may not be something that appeals to them. However, for a person or party with the right risk profile and mindset, the amount of value this brings to the table can be considerable.
Most new franchises do not have a great number – if any – established franchisees that prospective franchise buyers can actually ‘sit down’ and speak with about the concept of the business. (Validation is the term used for the process by which franchise prospects speak with existing franchisees and learn all about the company they are wishing to join, as well as the people behind it.)
Prospective franchise buyers should be encouraged to speak candidly with current franchise owners about the brand, but this is impossible to do if there are no franchise units already in the system. Not everyone who is looking into purchasing a franchise is a good candidate for a newer brand. Many people are just not comfortable with their own ability to determine if a newer franchise is one that is solid enough for them to join. In many cases franchise buyers simply avoid new concepts and only consider those that have a minimum number of units.
So, what are the important things to look for in a franchise brand? First and foremost, the people behind the brand are the place to start any evaluation. How long has the actual brand been doing business? What is the actual experience of the franchisor/owners with this brand, or with the related concept? For example, if an owner has a lot of experience as a food concept franchisee, they certainly should know all the ins-and-outs of how to operate a food based business even if this is their very first franchise offering. They should also be aware of what they have liked or not liked about the way they’ve been treated in the past by their franchisor(s).
Experience in a ‘like’ concept can mean a tremendous amount in evaluating a newer brand. So make sure to ask the right questions in order to get a ‘feel’ for the company. What systems and processes are in place to support the franchise as it grows? Does the franchisor stumble over the more in-depth questions you ask? Make sure that the franchisor has very quick, concise and knowledgeable answers. If you see an issue with this during your evaluation, then the brand – most likely – is not for you. On the other hand, if you find that the franchisor has a compelling story and solid answers to your inquiries, you may want to seriously consider that brand. Sure it would be nice to have some other franchisees to speak with and question about the franchise, but having them doesn’t mean everything when it comes to assessing risk – nor does it guarantee success.
Asking the right questions and really getting to know the franchisor is very important. It’s vitally important to spend time face-to-face and really get to know the franchisor on a personal level. It’s critical to evaluate the kinds of people they have surrounded themselves with in their business, and also see what kind of team is in place to support new franchises.
When it comes to making the final decision it’s a judgment call. But you must take into consideration all of the things we’ve discussed and also see what you can find out about the owner’s past. It comes down to two things: doing your homework and following your gut instinct. You need to make sure that you believe in the owner, their sincerity and their competence.
Becoming a franchise owner of an First Step HomeCare in your area goes well beyond a money-making opportunity. Not only would you be involved in the biggest industry in the world, but you will be a part of a responsible, loving, caring, skilled and talented company.
The risks are minimal and the research is far easier considering the fact that their 500,000 person standard territory is twice the size of other home care franchises. Their Management and Reporting Systems are already in place to help you grow a great business, and the territories available are up to 1.5 Million in Population. Most of all – instead of having o be worried and fret about a ‘new idea‘ or a ‘new risky venture’ – First Step has a proven system based on a solid 10 year track record.
There just isn’t anything more to say!
Until Next Time, Everybody.
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