By Armando O. Bartolome
The other day while watching a popular telenovela I saw a string of commercials of various businesses. I must have lost count of the number. However what are common to most are two words “Now Franchising”.
Way back in the mid-nineties, seldom would anyone hear those words spoken or advertised. There was just a handful and most were on the expensive side.
Today almost there are more and more businesses, which are using franchising as a means of expansion. Approximately there are around 2000 plus from various kinds of food and retail services. It is nice to know the growth of this sector.
With many choices, I met several people who narrated the bitter lessons experienced in investing in a franchise business.
Let me share the top 3 mistakes when investing in a franchise.
Thus the investment of the franchise may refer only to the business per se but not on the totality. The person must also verify and do a projected financial return. If the amount of the franchise is cheap, a question must be why so cheap? How competitive is this? Last but not least get hold of the list of franchisees and do check on their experiences. Chances there may be many undiscovered questions.
The experience of the couple could have been prevented if, in the beginning, they sought the guidance of professionals. Assuming is always a dangerous step. Always ask what covers the support including the frequency of visits. I recalled a popular resort and casino where top management fired the general manager of the group. The honcho was dissatisfied with the performance and remised of what was initially agreed upon.