Franchise ownership is a significant financial...
There's been a growing interest in Canadian franchises because more and more people are reconsidering their current jobs during this time of great financial uncertainty. For many people, the changes the pandemic has brought mean lower financial security or even no income at all. A stable franchise, therefore, can become inviting because it offers more security and the chance of an income.
As you consider your franchise options in these uncertain times, keep the following tips in mind.
Look for non-seasonal, repeating revenue
Keep an eye out for franchises that offer services or products year-round if you are looking for more stability. This doesn't mean that franchises that are busier at certain times of the year are out of the race, however. Many franchises that were once seasonal have branched out to offer services or goods to consumers throughout the year.
Examine the franchisor's financial position
A strong financial position is important for you and your possible franchisor. When there's enough to invest, success is usually easier to achieve. Ask the potential franchises you are considering to disclose their financial documents. If you're not sure what the numbers show, work with a financial professional to find out.
Ask each potential franchisor about any financial incentives they may offer as well. You may be able to benefit from those incentives, and offering them can be an indication the franchise is financially stable.
Go with an established franchisor if you're unsure
Newer franchises can be a great opportunity to get in at the ground floor. However, if your goal right now is to reduce the uncertainly the current pandemic has caused, you'll want a franchisor with a proven and long-term track record.
Look closely at regional data that aligns with your own plans. If, for example, your franchise will be the first in a metro area, look at the data from other first-timers in similar metro areas. When the franchise you choose is known to the public, you will be able to benefit from that market recognition, and you'll be able to see how that has worked for other franchisees.
The pandemic has ushered in many changes, and it has affected businesses at multiple levels. If you are ready to strike out on your own but need something more stable than starting completely alone, consider working with a strong, year-round and established franchise.