Remember how every episode of the original Star Trek TV series began with Captain Kirk proclaiming that he was about to "boldly go where no man has gone before"? Well, that's often what you'll be asked to do when you sign on with a franchised business. The burden is on you to take a product or service and sell it in markets that may be untried, untested and, if you don't watch out, unsuited to your franchise. So before you try to take that McDonald's, Sir Speedy or 7-Eleven where no McDonald's, Sir Speedy or 7-Eleven has gone before, find out if it will work.
The Value Of Research
Before you decide to buy a franchise, you need to determine the extent of the demand for its products or services. By systematically collecting, analyzing and interpreting market data, you can uncover key trends, form a better understanding of the franchise's market, customers and competitors, and make an educated decision about whether to purchase it. Those insights can help you answer questions such as the following:
- Who are my potential customers?
- Where do they live?
- How often do they buy the products or services the franchise offers?
- What styles, colors or flavors do they prefer?
- Why do or don't they buy from the franchise?
- How do the strengths of the product or service match their needs and wants?
- What hours do they prefer to shop?
- How do they rate the franchise vs. its competitors?
- What advertising media are likely to reach them?
If the research shows that demand is sufficient to support your prospective franchise, you can use the results to help find an ideal location and develop a start-up marketing plan. Investing in market research before you buy will also help you organize information for prospective lenders.
And if your research reveals that customer demand for a franchised product or service is declining or non-existent, you'll avoid making an expensive, heartbreaking mistake.