“Hi, Phil Harvey here with some Franchise Straight Talk. I’m most often asked the question, how do I know if this is a good franchise system? The short answer is • they have to have the right componentry • and you have to validate it. • And then you have to feel comfortable waking up in the morning that you’re gonna feel good knowing that this is a business that you’re in and you’re proud to be providing the value in the service to the customers, the jobs to employees, and that you’re very, very comfortable in your own skin, stating openly, this is the business I’m in, and I’m very proud of it.
Now, in more detail, there’s a lot that goes into assessing whether all the right elements there. ~ And that means spending several weeks going through a methodical process to understand the brand to understand how they go to market, to understand their marketing, to understand the financial model, the unit economics as it’s called, and to understand how that profitability occurs, to understand what is the actual systems that they use, how well are they performing, and to understand that, you have to validate.
Validate’s a fancy word for speaking with existing franchisees, learning from what their experience is. And I recommend you speak to franchisees at varying stages of their development. Those might have been there for six to 12 months, or they’ve freshly gone through the process that you are exploring and learning. And those who’ve been there from 12 to 24 months, they’ve been through a couple of cycle,s and they can validate to you openly whether they’ve achieved their goals for hitting cashflow positive and profitability.
And then there are those who’ve been there for a longer period of time, 36 months longer. Understand that there is a continuum of life, and there is a continuum of a need for a continuous improvement perspective. Because what a franchise was three years ago when someone joined may be somewhat different from what it is today by way of the technology that’s used, by way of the marketing strategy that’s being used, and by way of the… number of franchisees in the system, the feedback that’s been received, and in fact even the leadership.
That all being said, if you have done that work, followed a rigorous method and approach, and diligently evaluated that franchise system, you will find out the answers. And if those things I’ve just highlighted are present, and you can validate with franchisees that in fact it’s real, then the question is… do I feel good waking up in the morning saying, that’s my business? That’s how you’re gonna know if it’s the right franchise system and a good one for you.”
