When you sign up for your new Canadian franchise, it...
Joining a Canadian franchise is an exciting time. After all, you're finally becoming your own boss and working toward the financial future you've been dreaming of. While help and support from a good franchisor will help you stay on the right path, there is still a possibility you'll make some mistakes along the way.
Your franchisor will take a look at your finances before you join, but there's always a chance there will be unexpected expenses or delays that no one would have anticipated. A build-out may stall or newer vendors might be hesitant about extending your credit, so you should have at least six months of business and living expenses set aside before you open the doors.
Have lines of credit and back-ups at the ready from the start so you never find yourself up against the wall with no way to pay your business costs. Being under-capitalized is one of the most stressful experiences new business owners may go through, and it's definitely one to avoid.
It's only natural to want to beat the competition; who wouldn't want to get all of their competitor's customers? In reality, you're most likely to dilute the competition's business and only get some customers. Be reasonable when it comes to your expectations. A successful competitor has many advantages over you: they're already established, know the industry and have found success within it. Their success does not automatically mean you will do well too, however. You'll need to do your homework, focus on your quality levels and try to outsmart the competition by using the benefits of your franchise system.
Being frugal is a practice that will serve you well in some areas. Watching every penny spent on the cost of goods and labor is the mark of a good business operator. However, if you have a physical location for your franchise, that location is also playing a crucial role in your success. While you can save money by selecting a location in a less desirable area, you are limiting your business right out of the gate. You'll need to balance your overhead with the costs of a location where you will be fully accessible to customers to see what you need to do to make it work.
With a franchisor available to offer guidance, you are less likely to make some of the mistakes that new owners tend to make. However, there's still room for errors, so do your research and plan ahead so you can avoid them.