Today, franchising is an established and successful business concept. With the rising popularity of the concept, a large number of business aspirants are considering taking up a new or an existing franchised outlet. However, if you are considering taking
‘Franchise resale’ is a concept in which an existing franchisee sells out his franchised outlet or store with the permission of the franchisor. This reselling by a franchisee can be attributed to various reasons like non-profitable condition, lossof interest by the franchisee, health related problems, sudden demise of the franchisee, or if the franchisee is shifting his base somewhere else, etc.
Now the question is why one should buy a business which is not doing well. The various reasons for this can be due to the fact that as a new franchisee you will get an outlet in the preferred location with all the fixtures, infrastructure etc, and may not even have to recruit employees as the outlet already has trained staff. Moreover, if you employ few more employees, they can get training from the franchisor and other trained employees. There are many other benefits for the new franchisee but these can be experienced after considering certain factors. Let us have a look at why one should consider taking up an existing franchise.
Running an existing franchise
A prospective franchisee keen on buying an existing franchise has to contemplate few things before going in for a franchise. These are as given below:
Extensive research of the franchise: Any potential franchisee interested in buying an existing franchise should conduct an extensive research before buying. First, find out the reasons why the present franchisee is selling his franchise. A franchisee who is making high profits will never want to sell his franchise. Therefore, studying the market and figuring out the reasons behind its failure will offer you with ample information regarding the franchise. There may be reasons like the franchisee’s disinterest in running the outlet, inappropriate location, or a common franchise concept etc. Take the franchise after knowing the real reasons. If you are satisfied with the franchise, then only make the few necessary changes and start the operations.
Meet and seek the franchisor’s support: As a new entrant to the franchisor’s network, it is a must to know and ask the franchisor for his support and assistance in making the franchise successful. Do not be satisfied with dealing with the old franchisee only. Fix up a meeting with the franchisor to talk to him at your level. It is always recommended to get specific commitments on training, staff assistance, infrastructure etc from the franchisor.
Do not hope for big profits: New franchisees always want to taste success in a short time. It is good to hope and work hard, but never expect to do wonders in a short time. If you believe that, you have addressed all the problems faced by the existing franchise, do not assume that the franchise would start making profits from day one. Be prepared for a tough time and struggle hard for achieving success.
Implement changes before starting operations: As a new franchisee for the old franchise, it is a must to inculcate a few alternations in the franchise outlet. Maybe the old franchisee did not consider it worthwhile to spend money in maintaining the outlet. So before opening doors to the customers, remember to renovate and change the equipments which are not in good condition, etc.
Make customers the focal point: For any franchise to be successful, the franchisee needs to pamper and give attention to his customers/clients. In case of taking a franchise resale, the new franchisee should focus his priorities on customers so that he can remove all the grievances the customers had experienced with the previous franchisee. Previously, if the franchise did not have a good reputation among clients, it is the new franchisee’s duty to change the attitude of the clients by offering them the best services and products.
Employ marketing strategies: No doubt, the franchise was operational earlier but after you have taken over, remember to advertise about the vital changes that have been employed. People should be made aware that the franchise has been remodeled as well as the owner also has been changed. Spread this through all the media like newspapers, TV, radio, pamphlets etc. In addition, creating your own website as well as using the various other networking sites is a great idea to market the outlet.
To end, the new franchisee must put in lots of efforts to make the old franchise run efficiently. Employing simple yet strategic steps will promote sales and help the new franchisee attain success in less time.