How to Start a Franchise Business: Five-Step Guide That Will Teach You – Franchising is booming now in the Philippines. If you want to run your own business without the risk of creating your own start-up, you should learn how to start a franchise.
When you start a franchise you buy the right to use the name of the franchisor. Here in the Philippines, there are literally hundreds to choose from food franchise, service franchise, medicine franchise, etc.
Here is a five-step guide to teach you how to start a franchise.
1. Organize your priorities. Because there are so many franchises to choose from it is important that you know what kind of business you would like to run. Understand the work environment you work best in and what type of business best fits your lifestyle. For example, a restaurant might be a great franchise for you if you like customer service.
2. Research. There are many venues you can use to get more information about individual franchises. The internet is a great resource. If you are willing to spend the extra money, you can also hire a franchising consultant.
3. Contact the franchise you would like to buy. The Franchiser will give you material explaining the specifics of that particular franchise. This is a tricky step because the franchiser is trying to learn about you at the same time you are learning about it. The franchiser wants to make sure that you are the right person to manage its business.
4. Get an attorney. A franchise attorney specializes in reviewing franchise contracts, understanding state statues related to Franchising and limiting your liability.
5. Sign the franchise agreement. This document outlines your responsibilities in running the franchise and the parent company’s responsibilities in helping you do so. It will lay out the initial franchise fee, advertising fees and royalty fees. It will also explain the terms of the restrictive covenant – the agreement that prohibits franchise owners from owning any competing franchises. Your lawyer should review the franchise agreement.
Now that you know the basics of how to start a franchise there are a couple of additional points you should keep in mind like getting franchise loan from your banks and other financial institutions in your area.