Franchise Euphoria Flashback to Carol Tice & Mistakes to Avoid When Buying a Franchise
Key Takeaways:
[0:18] Today’s episode of Franchise Euphoria is brought to you by IndyFranchiseLaw.com, a leading resource in the franchise space. Head over to IndyFranchiseLaw.com learn more!
[1:00] For today’s episode, Josh heads into the archives of early Franchise Euphoria to bring back an episode with esteemed business author, Carol Tice, who was featured on the third ever episode of Franchise Euphoria.
[2:06] The flashback begins with Josh introducing Carol Tice, a franchise writer and blogger who has incredible insight on the risks associated with franchising.
[3:20] Carol’s writing career really took off when she transitioned to reporting. She spent five years writing about home improvement--specifically lumber yards--which served as her introduction into the business world.
[5:30] One of the big things you want to buy with a franchise is expertise and a proven model. Oftentimes, businesses start selling franchises quickly after opening their first location. This can be a red flag to anybody looking to purchase a franchise.
[7:38] As a franchisee, you need to ask yourself what you are getting out of your franchisor in return for the royalty fee you pay them.
[9:41] While you miss out on brand recognition by buying into the franchises, on the other hand, you are presented with ground floor opportunity.
[10:52] Buying a franchise is kind of like a romance movie. People fall in love with the brand and commit to purchasing a franchise, but the problem is that they don’t do their due diligence.
[12:00] Carol suggests that you ask yourself the following questions before you buy a franchise: (1) How many of these franchises have been sold off, closed, or changed hands in the past year? (2) Have you spent a day job shadowing an owner who operates their business? (3) Have you called up owners and asked them if they would buy the franchise again if they go could back in time?
[14:53] Many people don’t realize that franchise failure happens behind the scenes.
[19:04] Some people will really hate being franchisees because they want more freedom to do their own thing.
[22:30] Franchising often appears as a safer option than starting your own “Mom & Pop” business, but Carol is not entirely convinced that is the case.
[24:51] Carol suggests that something that new and potential franchisees don’t account for is how much money they will need to get over the hump of starting a new franchise location.
[27:52] In franchising, once you sign your franchise fees, you never get that money back, so it’s all the more important to be very careful on the front end and do extra due diligence.
[30:26] You have to realize that there is no guarantee for success when it comes to franchising, but you can increase your likelihood by doing some real research before getting yourself into that situation.
[35:37] Thanks for listening, and please, reach out to Josh anytime through email at josh@franchiseeuphoria.com. If you enjoyed this interview, please leave us a review on iTunes.
Mentioned in This Episode:
www.caroltice.com