I was flicking through a couple of franchise magazines today and I was struck by the amount of advice given to potential franchisees about how to choose the right business for them.
The essence of the advice is always the same and goes something like this:
- Make sure you know who the franchisor is and that they are financially sound. Make sure they have a track record and understand franchising, too.
- Make sure you understand the role of the franchisee and what you will be expected to do, such as delivering the product, making sales and marketing the business.
- Get to know the financial projections behind the business and take what the franchisor tells you with a pinch of salt.
- Talk to other franchisees and make sure the franchisor allows you to talk to a random sample, otherwise you’ll only be speaking with a) those that are doing well or b) those that have been rewarded to say good things.
- Get independent advice about the franchise agreement and anything else to do with the business that you’re not quite sure about.
All very logical and sound advice that you will find regurgitated in many forms in many places from seminars to websites.
But there’s a bit missing. Let me explain.
There’s a new survey out about franchising and it says more than 25% of franchisees set out because they want to be their own boss, closely followed by the ambition to start a business. And, of course, franchising helps if you’ve never done it before because you’re not alone, there’s support, etc., etc.
But the piece of advice that’s just about always missing is from these columns is this…
Learn about business, too. It needn’t take long, but teach yourself how to read a Profit and Loss statement and a balance sheet. Think about everything else you need to do as well as ‘the job’, such as VAT returns, bookkeeping, HR law and so on.
Learn how to organise a business, how to plan for the future, set yourself budgets and then work to them. Teach yourself to manage time more effectively and then how to use time to work with your customers better.
There are a million details you have to keep control of when running a business and franchising definitely helps you do it. But, to be a really good business person you need to go beyond the advice in the franchise magazines and learn how to be a business person.
Otherwise, as Michael Gerber puts it in The E-Myth, you’ll just end up buying yourself a job, and one where you work longer hours, with more responsibility and for less pay than the one you have right now.