Why Are You Buying A Franchise? . . . Really?

“You don’t need to invest all that money to get into the pizza business,” the advisor told his client/friend. “You make the greatest pizza I’ve ever tasted. Far better than anything those franchises offer. You don’t need to pay them all that money upfront, and then — my God — you’ve got to pay them nearly ten percent of your revenue for the rest of your life. Don’t buy a franchise!”

Expect to hear that advice

I invented the above scenario, but it’s real nonetheless. Franchise prospects almost always hear something similar to it. If it’s not about pizza it’s about cookies or chicken or services of all kinds. These passionate commentaries are often shared by accountants, lawyers, family members, or friends — people who mean well, but don’t always understand the real story.

If you’re thinking about buying a franchise, chances are you have met, or you will meet, one of these “advisors.” And when you do, make sure they understand the real story behind why you are buying a franchise. Even better, make sure you understand why you’re really buying a franchise. It doesn’t matter much what the “advisors” think, although I can understand why you’d like them to be on your side — you may need their help, financially and otherwise.

Understanding why people buy franchises

So what is the real story? Why do people buy franchises?

Because, look, there’s some truth to that fictionalized scenario I posed earlier. Some people can indeed make or provide better products and services than some franchises serve up. So who needs a franchise? If you can bake, fry, grill, make something — anything — better than what the marketplace offers today — if you can provide a better service — why do you need to buy a franchise?

Several good reasons, and here’s the first

In a word, I’ll tell you why: marketing.

One of my favorite cousins in Ohio made the greatest pizza ever. You got a whiff of her pizza baking and you thought you were in Italy. One bite and it was over. Never again would you buy pizza from anyone else.

So why did her business fail?

Miss this and your business fails

Because she didn’t know how to market her pizza. It was the world’s greatest pizza, no doubt about it, but she didn’t know how to sell it. She didn’t have a brand. No presence. No home delivery. No knowledge of how many slices of pepperoni to put on a large pie and make a profit upon selling it. Didn’t know where to advertise. Or how. . . . There were countless other issues all related to the operations of the business. Ingredients, recipes, how to mix it, fix it, bake it, serve it — no problems there. She just couldn’t market it!

How much better off she would have been had she just bought a franchise!

Know what you know

So when your “advisor” tells you that you make the greatest whatever, or you provide a better service, you can accept the compliment for what it’s worth. And even though it’s true, if you know that you don’t know how to market your product or service, then that’s why you’re buying a franchise. It’s what you know that matters.

Your accountant, your lawyer, your family members, your best friend — they do not know! You do. Tell your accountant to give you financial advice, not business advice. Tell your lawyer to give you legal advice, not business advice. And tell your family and friends — nicely, of course — to keep their advice (unless they are successful business owners).    

It’s a good reason, but not all franchises provide it

Marketing know-how is a very good reason to buy a franchise. . . . providing, of course, that you buy into a franchise that knows how to market and how to teach its franchisees to market! (Sadly, many do not).

Marketing isn’t the only reason for buying a franchise. More reasons are coming in future blogs!

Register now for free tele-seminar

. . . Register immediately for my free franchise tele-seminar. I’m giving subscribers to my blog the first opportunity to sign up for the tele-seminar and get an unbelievable package of information about franchising–all free. Next week I’ll begin promoting the tele-seminar to thousands of prospective franchisees and once the available slots are filled the tele-seminar will be closed. So this is your early notice — sign up now and take advantage of this opportunity. 

Photo image by: foéÖþoooey

Categorised in: Buy a Franchise

This post was written by Dr. John Hayes