Selecting the best franchise is an extremely important decision.
It doesnâ€™t matter if you are an owner-operator who needs to live off the proceeds of a single unit, or a multi-unit (or even a multi-concept) investor looking to add to your brand portfolio, itâ€™s critical for you to find the opportunity that best meets your objectives. Between the overly general and happy hype of some small business publications and the sterile franchise directory listings that communicate with all the enthusiasm and insight of a telephone book, it can be hard to get a good feel for the different franchise opportunities that are available.
For this reason, many prospective franchise owners select an opportunity because the company is a household name and hasÂ thousands ofÂ franchisees, or they choose one that has been referred by a friend. They limit themselves to a handful of choices, and never discover the thousands of opportunities available, some of which may better suit their markets, their budgets, their lifestyles, their personalities, their passions and their abilities. We publish IdeaFarmâ€™s FranBest Journal and the Best Undiscovered Franchise Guide to get the word out about some of the impressive companies we discover in our travels through the land of franchise opportunities.
Thereâ€™s no doubt that many large, well-established franchise chains provide tremendous advantages that small or relatively new chains canâ€™t, such as large-scale purchasing power, national advertising campaigns and established brand recognition. And itâ€™s definitely true that many small and/or start-up franchise chains have not yetâ€”and might notâ€”stand up to the test time.
Whatâ€™s equally true is that an established chain franchise is not your only, or necessarily your best, option. While the flexibility and uncertainty of getting in on the ground floor of a small or new undiscovered franchise isnâ€™t for everyone, you should consider some of the potential advantages:
Vast growth potential. Many of the best territories and sites for big-name franchises have been locked up for decades. Getting in on the ground floor of an undiscovered franchise could mean youâ€™ll be able to pick from the many prime territories and locations still available.
Personal attention. As an early franchise owner, the franchise company has a great deal riding on your success. Your positive attitude will be crucial in recruiting new franchisees, as will your thriving business. You will be a valuable member of the team at the most exciting stage of growth.
Direct access to the founder. Many concepts are forged in what I call the â€œfounderâ€™s fireâ€: the original vision and passion that made the concept successful in the first place. Even in the best organizations, itâ€™s tough to keep it burning. Early franchisees learn directly from the founder or principal and get the benefit of their undiluted vision and personal guidance. Imagine working directly with Ray Kroc or Harlan Sanders.
Lower ad contributions. It seems like a benefit to have national advertising campaigns and multi-million dollar product placements in popular movies. But who do you think is footing the bill? The larger franchises often will require several percent contributions toward national media advertising. Undiscovered franchises are generally focused exclusively on your local market…where the sales happen.
Greater flexibility and speed. Smaller franchise companies can seize new opportunities and can adapt to trends in the marketplace with more agility than their larger competitors. If you are entrepreneurial, you may find the pace of change in the big chains frustrating.
Personal attention. Franchisees of undiscovered franchises generally have the CEOâ€™s cell phone number on speed dial. Franchisees of big chains are lucky to get a handshake at the national convention. Would you rather be known by your name, or as Store #3407?
Greater voice. As an early franchisee, your opinion and input is highly valued. Your success is integral to the growth of the chain. If you own one of the chainâ€™s ten franchises, you constitute 10% of franchisee opinion. Of course, that will get smaller, but your input will help guide the chain.
A key difference between a large, established franchise chain and a relatively new or small franchise is that, with the former it is the system and not the personalities that is most important; with the latter it is the reverse. If you are investigating an undiscovered franchise, it is imperative that you respect, like and trust the principals of the company because, unlike the big chains, you will be working with them very closely.
Are there potential downsides of being part of a new or smaller franchise chain? Absolutely. It will require flexibility, since often procedures and rules will change several times before they are finally set (yet again) in stone. There are fewer franchisees to network and exchange information with, though that will change. And systems, procedures and tools are often still being refined. The rewards of getting in on the ground floor can be greater, as long as you have the flexibility needed to roll with the changes that inevitably come as the company grows. I hope you enjoy discovering our Best Undiscovered Franchises. They are great people running great businesses, and I encourage you to explore each opportunity fully. Best of luck with your search. I hope youâ€™ll soon discover the opportunity thatâ€™s best for you.