What to look for when choosing a franchise

The most important thing to look for when investigating a franchise is that all of the available evidence (current and past) indicates that the business is both reputable and steady. You want to make sure that the franchise includes all of the elements of success and that those elements are in place before making an investment.

The following is a list of things to consider and factors to look for as you begin your request for information:

1. How do company representatives respond to your request for more information? Remember that you will be building an ongoing relationship with the franchiser and first impressions speak loudly. If the response is not professional, timely or organized it may indicate problems down the road when you need assistance.

2. What type of operational training does the franchiser offer? Becoming a franchisee means that you are investing in a business that has standard operating procedures already in place. It is important to ensure that the franchiser is offering enough in depth training to equip you with the skills necessary to run a successful business. It is wise to contact other franchisees to solicit their impression of the training program as well as post-training support.

3. Training programs, other then operations, should include all of the other skills needed to run a business, including payroll, insurance, employee policies, etc. In short, you should be in a position after training to open your business and have it run as though it had been in existence for years.

4. What type of marketing programs are offered? Not only will you need to make sure that the franchiser has a marketing program in place, but that the program is both professional, consistent and effective. Once again, it would be wise to contact current franchisees and inquire about their level of satisfaction with the advertising campaigns.

5. In the event that a franchiser requires a business location to be selected and a building constructed according to their specifications, it is important to ensure that they also offer construction support. Most perspective franchisees do not have the level of expertise needed to complete a commercial construction project and will need assistance with real estate negotiations, purchase and project supervision.

6. If you will need assistance in financing part of your investment, you will want to ensure that the franchiser has procedures in place to help you out. Although most franchisers do not offer direct financing, they usually have items such as business plan templates for your use and may be able to provide leads to lenders they work closely with.

7. Another important factor to consider when verifying that a company is solid and steady, is their legal history. In this day in age it is virtually impossible to find a company (especially franchises due to their sheer numbers) that have not been involved in a lawsuit, however it is important to determine that it is not a pattern and that the franchise deals with lawsuits in a fair, professional and equitable manner. Most of this information can be ascertained by carefully reading the litigation disclosures in the "Uniform Franchise Offering Circular".

8. Look for financial stability and strength. Carefully review the company's financial statements and, if you are not qualified to do so, hire an accountant to review the records for you. In order to carry out its promises to you as a franchisee, it is necessary that the franchise itself is in good financial health now and the future.

9. Although it is sometimes difficult to confirm, questions should be asked and investigation made into estimated time frames for realizing a profit from your investment. Although you should anticipate a period of time when more finances are going out then coming in, this period of time should be financially reasonable to a franchisee and is an essential piece of what a franchise has to offer.

10. Check the attitude barometer of other existing franchisees. If the vast majority of franchisees are happy with their experience in the above areas, the franchise certainly bears more investigating.

As you take that big step to open your own franchise, you will also want to open a merchant account so your business has the ability to accept credit card payments.

Money Tree Merchant Services offers a wide variety of credit card machines and credit card processing software sure to meet your business needs. As a new retail customer, you qualify for a free credit card machine - a great way to get started! This is especially helpful when starting a franchise because we will place free credit card machines in multiple locations within your franchise network.

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