One of the most common questions asked by prospective
franchisees is "what will happen after I sign up for a
franchise?"
More specifically, they want to know what they need to do to get
their business open, how long it'll take to open and how
they'll know they're not missing some important task along
the way. The answers to these types of questions are as numerous
and varied as the many franchise opportunities that exist in the
marketplace.
There are, however, a number of general answers that hold true
for any good franchise company. You should be able to expect the
following to begin very quickly after signing up:
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System Documentation. Most franchisors rapidly send a new
franchisee documentation concerning their system and the tasks
involved in getting the new business established. The franchisor
wants the new franchisee's business to open quickly just as
much as the franchisee does, and part of the secret to making this
happen is to get moving up the learning curve as fast as
possible.
The system documentation almost always involves training
manuals, with the normal subject emphasis being on operating
systems, marketing and new business setup. They might also use
other media to present or reinforce this information, such as
company intranets, training videos or CDs, and even personal visits
to the new franchisee from company employees.
Critical Path Items. Franchisors, through their
experience opening other new units, should be able to easily
identify the critical path item or items necessary to opening units
quickly and correctly. It might be real estate (including issues
such as finding the location or dealing with zoning or permit
issues), employee hiring (especially in franchises, which need a
lot of minimum wage-type employees or employees with special
licenses), construction and fixturing of the unit (including
sourcing local general or subcontractors), or even the franchisee
training process requirements.
The franchisor will communicate whatever factor normally takes
the longest to get done, and get to work on it immediately after a
new franchisee signs on the dotted line. This is the best insurance
against delays later in the process of opening the new
business.
Checklists. Though it is certainly not a solution unique
to franchising, new franchisees are usually provided with
checklists for virtually everything involved in the opening of
their new business. This tried and true approach is the best method
for avoiding costly oversights in the process.
In addition to providing basic checklists, most franchisors
provide timing data on every checklist item, so new franchisees can
double-check to make sure they are staying on schedule. As an
example, there might be a checklist of items titled "To Be
Completed at Least Five Weeks Prior to Opening," with a new
list for each succeeding week. A progression of such scheduling
checklists assists new franchisees in establishing priorities of
their "to do" list each week as they go through the
process.
The question of how long it takes to get the business open is
also one that has a very large range of answers, depending on the
franchise opportunity chosen. As a general rule, the following are
the most relevant factors in determining this answer:
- Real Estate. If the franchise involves leasing a
location, the normal rule of thumb is that it takes about three to
six months (or sometimes even longer) to get the business open. If
a location has to be built specifically for the business, plan on
six to 24 months for this to be completed.
- Training. With many franchises, it is typical for the
business to open within one to three months after signing up,
depending on how much real world experience is involved in the
training process.
- Financing. Though the size of the investment
doesn't, in and of itself, necessarily result in delays in
opening a business, most franchisees in larger investment
businesses use financing to cover part of the costs of opening.
Depending on the lender and type of loan, financing can introduce a
delay in opening of anywhere from six to eight weeks to as much as
six months.
Though these questions usually create anxiety in a new
franchisee right after signing up for a franchise, the easiest way
to alleviate this concern is to ask questions. Make sure to cover
these questions thoroughly with the franchisor and also with the
existing franchisees during your research on the franchise. That
way, you'll have realistic expectations when you sign up,
you'll know exactly what needs to be done and you should be
able to have a positive experience in opening your new
business.
Jeff Elgin is the "Buying a Franchise" coach at
Entrepreneur.com and has almost 20 years of
experience in franchising, both as a franchisee and a senior
franchise company executive. He is currently the CEO of FranChoice Inc., a company that provides free
consulting to consumers looking for a franchise that best
matches their needs.