Finding A Franchise: What To Consider When Buying a Franchise
Emergent trends can be alluring but can obscure the bigger picture of finding a franchise for the business’s longevity.
Take Jordan for example. She’s an entrepreneur who started a Virtual Reality Gaming franchise. Despite her initial success, market volatility and the fleeting nature of consumer trends left her without a sustainable, replicable business model.
Hopefully, Jordan learned a few lessons from her business. Fortunately, we can benefit just from hearing about it as a case study.
Here are the takeaways when finding a franchise from my mind:
Actually, you can’t avoid FOMO (the fear of missing out). However, you can avoid basing your decisions on it. Instead, I like to choose franchises based on products and services people need in their lives. Commodity-based needs will be vital long after hot trends fade away.
Distinguish Between Long-term and New Trends
Immediate profitability doesn’t guarantee longevity. Focus on franchises with a proven track record unless you’re financially prepared for shortfalls.
A franchise’s resilience to market fluctuations will determine its longevity. You want to get a franchise that performs well in good times and bad times.
In short, channel your inner Warren Buffett. (You can hold off on the Coke and peanut brittle.)
- Base your investments on prudence, not novelty.
- Be cautious. Be methodical.
- Focus on consistent growth and sustainability.
Of course, it’s not as exciting to wear a logo for residential cleaning as it is to wear something flashy, but you’re far more likely to outperform investors who roll the dice in the long term.
After all, are you getting into business to make money, or make a statement? Choose profitability and sustainability!