Edmonton Business Is For Sale | Should Entrepreneurs By Franchises
Many entrepreneurs believe that purchasing a franchise is a lower risk option when it comes to buying businesses says Edmonton business for sale. While there are some statistics that support that assumption, industry Canada says that 50% of all businesses are out of business within five years, but only 14% of franchisees go out of business within five years. Buying businesses always includes a risk there is a franchise or not. In order to make the right purchasing decision, entrepreneurs need to do their due diligence and research the business regardless of what the business is and who is selling it.
Many entrepreneurs like the idea of the franchise because it is a known brand that already has a customer base. However not all franchises are the same and how they operate and support their franchisees. When an entrepreneur is considering a franchise, they should avoid the mistake of looking at one franchise at a time. Edmonton businesses for sale recommends that entrepreneurs always compare franchises. An entrepreneur should have three considerations in order to be objective. Things to look for include how the franchise or supports their staff and what the franchise and royalty fees look like.
Once an entrepreneur has narrowed down their search, the next step they need to do is take the information given to them by the franchise or and get an opinion by their account. Edmonton business for sale recommends seeing accountant this early in the step because they will be able to read the franchise agreement and see the financials to give an opinion if this makes financial sense. Accountant will also be able to go over lease agreements, common fees, payroll costs and even royalties. Entrepreneurs should also know that the financial statements that are present to them may not be accountant prepared financials, which means they are not being given complete information. The accountant will be able to see that and helped business owner ask the right questions. Accountants have often saved entrepreneurs for making business decisions that worked in their best interest. Entrepreneurs need to understand that just because it is a franchise doesnít mean it is a great business offer. Franchisors exist to sell the franchise and make a sale not to make the best business decision.
Edmonton business for sale says once the accountant has reviewed the information, the business owner should make a business plan even before they make an offer with the franchise work. The reason for that is because the business plan may highlight certain problems a business owner may face including the ability to get financing. A business owner should encounter these errors before they signed with the franchisor.
Entrepreneurs should also do their own research into the franchise, Edmonton business for sale recommends the contact other franchise owners, ones that they have been directed to by the franchise or. Will be able to get a better sense of what it is like to own the franchise and get unprompted and blunt answers. An entrepreneur should look at various sizes of the franchises as well as various locations to get a good average.
Often when people are looking to get into business ownership for the first time, the belief that franchises are easily and says Edmontons business for sale. While franchises can be a great option because of their processes that theyíve developed in order to operate and market their business, franchises are the same as any other business, theyíre not all created equally and must be researched and investigated to find out if itís the right decision to purchase. While franchises can be a great option, entrepreneurs need to realize that there is an additional cost to owning a franchise. Those increased costs are franchise fees as well as monthly royalty fees. Depending on the business, the franchise fees can be quite steep, and the royalty fees can be expensive. Along with those costs come company recognition and customer base, business owners need to know if thatís the right decision for them.
One of the things that can help an entrepreneur discover if franchises are good for them, is if they may want to customize too many of the franchise processes. Part of the value of a franchise is comes with operating manuals on how to run the business, create their products and services, as well as advertise etc. If the business owner wants to change too many of those processes to their own way or their own system, they may not find high enough value in a franchise that has the systems already made. It may be in the business owners best interest to open her own business where they can customize all of the processes and all of the products and services says Edmonton business for sale.
If an entrepreneur has decided that buying franchises is the right option for them, the next thing to do recommends Edmontons business for sale is researching all of the various franchises. With all of the different franchises that exists, an entrepreneur needs to realize that they are not all created the same. Theyíll have different levels of support given by the head office, different franchise fees, different royalty fee structures, as well as different requirements for the business owner themselves. By looking at a wide variety of different franchises that are available to purchase, entrepreneurs can get a great sense of features they would like to have been franchises and features they would not like to have.
Once a business owner has narrowed down franchises the next thing that they should do recommends Edmonton business for sale is to go talk to the franchise owners to discover what they say candidly about owning that particular franchise. They will be blunt, honest and may even be slightly pessimistic in order to deter competition. Keeping all of these things in mind, the entrepreneur can make their best decision if they want to contact the franchise for further details.