http://franchiseesforum.com/forums/65 For franchising topics that don't fit elsewhere. We will create separate topics as the need arises
Please "SIGN UP" before you post. See top of page. ]]> en-us Copyright 2006, Kickapps feeds@kickapps.com (FeedMaster) webmaster@kickapps.com (WebMaster) Fri, 08 Feb 2008 16:18:40 GMT Tue, 01 Jun 2010 12:52:10 GMT Kickapps Feeds 1.0 http://blogs.law.harvard.edu/tech/rss 60 {pics-1.1 "http://www.icra.org/ratingsv02.html" l gen true for "http://kickapps.com" r (nz 1 vz 1 lz 1 oz 1 cz 1 ) "http://www.rsac.org/ratingsv01.html" l gen true for "http://kickapps.com" r (n 0 s 0 v 0 l 0 )) Search Domain q http://kickapps.com/search/direct/ http://franchiseesforum.com/topic/397/t/IT-S-ALL-ABOUT-TIMING-.html • You're satisfied that this business can make enough profit. (Make sure that your "satisfaction" is well-founded).
• Your about to go ahead and buy it/ sign the deal.

Ask yourself the following:
1. What do you know about the timing of the profitability and the cash-flow?
2. Will it take a month? A year? 2 years? More?
3. On what information are you basing your assumption?
4. How will you finance the cash requirements of the business in the period before it becomes cash-flow positive?
5. What about you and your family - Can you afford to wait for it to become cash-flow positive?
6. What happens if it "hits the fan". What is your fallback position? (Crying and screaming for help does not qualify as a fall-back position).

Remember, buying a business or franchise is as much about timing as it is about performance. Having similar... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/397 Mon, 14 Jul 2008 12:54:27 PST http://franchiseesforum.com/topic/396/t/IT-S-THE-LOCATION-STUPID-.html
Don't simply rely on what the franchisor tells you. The fact that a location "feels right" is really not a reason to commit to a lease.

Location-selection should be a disciplined exercise that takes into account the "Key Location Criteria" that the franchisor has determined are critical to success. The criteria will probably be weighted. If the franchisor has multiple units operating, this should be an integral part of his toolkit.
However, its mere existence does not necessarily mean that it's any good!

The first thing that you should ask for is to see the Checklist so that you can determine whether one exists.
If it does, you should determine whether your location has been selected using information that is relevant to the items on the checklist.

Now go and look at other locations that the franchisor has... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/396 Tue, 10 Jun 2008 16:01:13 PST http://franchiseesforum.com/topic/395/t/DON-T-BUY-A-FRANCHISE-DO-IT-YOURSELF-.html
This approach may not be right for you - but at least you will have properly considered it!

Your initial response is probably:
"But I don't know what to do! Where will I start? It's all too hard!"
Your initial response may well be w-r-o-n-g. Read on, and then decide.


STAGE 1 - THE BUSINESS
Answer these critical questions:
(Note: Ensure that you talk to someone who has industry knowledge who can answer these.)
1. Is the franchise in an industry or of a type that is heavily dependent on the franchise brand for custom?
2. Is the franchise a business that requires "peculiar" skills & know-how that cannot readily be purchased?
3. Does the franchise sell a service or product, or use a methodology of such... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/395 Tue, 03 Jun 2008 14:26:19 PST http://franchiseesforum.com/topic/394/t/--FRANCHISORS-TREAT-EX-FRANCHISEES--ORDER----RUBBISHED-.html
It is well recognised by franchisors, that having an unhappy ex-franchisee is bad for business. No. Really?

The seminar discussed the basic philosophy about "looking after" departing franchisees by conducting exit interviews etc. All great stuff.

It also discussed the "defensive" actions that franchisors should take - actions that do NOTHING to deal with the root cause of the problem, and that simply address the symptoms. (Example: Include clauses in the Agreement to stop franchisees using the franchise name in a website address that may be used to "rubbish" the franchise - www.XFranchiseSucks.com.au ).

The new Disclosure rules also make it mandatory for franchisors to list franchisees who have left the... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/394 Mon, 02 Jun 2008 15:22:36 PST http://franchiseesforum.com/topic/393/t/Are-there-franchisees-who-actually-MAKE-money-Tell-us-.html You pay your $200 - $400K for the franchise
You pay yourself a salary for the 50 hours a week that you work in it.
At the end of the year, is there anything left (Profit after interest & tax)? How much as a % of what you invested?

C'mon - tell us. There must be at least a few franchises that are making their 20% ROI.

The Franchisees Advocate Group
Business And Franchise Help ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/393 Thu, 15 May 2008 20:25:37 PST http://franchiseesforum.com/topic/392/t/I-PURCHASED-A-FRANCHISE-IT-S-NOT-PERFORMING-WHAT-NOW-.html
Your response is "I've been sold a lemon! I'm going to court!"

Whoa … That attitude is simply not going to help you!

Why? Because:
• Suing the franchisor is, in most cases, not a practical option.
If you go down the legal-action route, you had better have tons of money, time & fortitude to spare - you're in for a ride that you cannot imagine. And however "right" you may think you are, there is always the chance that you will lose. Legal action is a gamble!
• Selling a "dying" business means that you will take a serious financial hit. That assumes that it is in fact saleable (a huge assumption) and that the Franchisor will agree to your selling it.

Facts:
• Not every site that the franchisor selects/ approves for franchisees will be great. You... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/392 Thu, 08 May 2008 10:01:41 PST http://franchiseesforum.com/topic/391/t/GOT-A-HOOK-It-s-tough-without-one-.html Without at least one "hook" you will need to rely on "shouting louder" than your competition. That's a very expensive alternative.

So, what's this "hook" we refer to (with such affection)?
The hook is an outstanding characteristic (or 2) that makes your product/ or business particularly "special" in the eyes of the customer, and that is not easy for competitors to copy.

The "hook" may be included in any of the elements of the marketing mix - i.e. in any of the: Product, Price, Promotion (Marketing), or Place (Distribution channel). That's why we refer to the "product offering" above, and not simply the "product".

SOME EXAMPLES:
• Product hook: A chicken restaurant concept we established in Australia has "flat" chicken & peri peri spice.
• Price Hook: A... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/391 Tue, 06 May 2008 16:08:25 PST http://franchiseesforum.com/topic/390/t/Batten-down-the-hatches-Are-you-ready-for-the-tough-times-.html
If you haven't already completed these defensive actions (below) in your business, here are a few you may want to attend to. Soon. Like yesterday!

Debtors:
Pull them in. Customers who don't pay you aren't any good to you.
Manage this carefully, as you certainly don't want to chase good customers away just because you've "taught" them to be slow payers.

Stock/ Inventory:
Slow moving lines - Identify & reduce the stock. Be ruthless. Now is the time to convert stock to cash, not to "hope like hell" that you'll be able to sell it in 6 months time for an extra 10%.
Dead lines - Identify lines that should be discontinued, liquidate them and DON'T re-purchase.
Minimum & Max Stock levels - Recalculate these to take account of... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/390 Tue, 29 Apr 2008 07:02:00 PST http://franchiseesforum.com/topic/387/t/Existing-franchisees-appear---doing---s-------SIGN--.html
It may sound obvious but past performance is not a reliable indicator of future performance.

Unless you know what's happening (or about to happen) in the Industry, and in the market in which you will operate, you could be in for a rude wake up call. We live in a time of rapid & continual change. Unless it is managed, you will be left wondering "What the hell happened to my business?"

In addition to seeing how others are doing, there is substantial additional research that must be done to ensure that the smiling faces will still be smiling in a year or two's time. "Looking into the future" is an essential aspect in deciding whether to buy into a franchise, or in deciding what changes to make to your business.

Anyone have experiences that illustrate how the past performance of your business or franchise has not been a reliable measure of future performance?

The Franchisees... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/387 Mon, 21 Apr 2008 15:00:37 PST http://franchiseesforum.com/topic/386/t/--fly---plane-----10-chance---crashing-.html
There is at least a 10% chance that your new business will fail. In fact new business failures in the first 5 years are above 70%. And franchises are less, but not so much less that you can throw caution to the wind.

If you (or your spouse) sign as Guarantor, that probably means that you're putting the family home at risk.
What would the effect be on your life/ marriage etc if you lost your family home? Devastating!

So why are franchisees so easily agreeable to taking such a risk in the face of "bad" odds?

What methods should you use to avoid "signing away the family home"?
Any street-wise solicitors out there who may wish to make suggestions?

We know what we suggest, but we'd like to hear what advice others give.
NOTE: Simply saying "Okay. Where do I sign?" is NOT valid strategy!

The Franchisees... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/386 Mon, 21 Apr 2008 14:49:57 PST http://franchiseesforum.com/topic/383/t/Can-city-based-food-concepts-give-a-good-return-.html

1. Is it a furphy that the city is the best place to operate a food concept?
   
2. Is it reasonable to expect to make a good return on your investment plus payment of a reasonable wage for the work you put in?
   
3. What do you think is a reasonable return that you should be making on your investment (BEFORE paying yourself a salary)? Remember, you can get about 7% by putting your money in the bank at zero risk.
   
   Help each other get a realistic view of "what's happening out there"!
   
   General observations regarding city-based food outlets include the following:
   - Rentals are very high
   - There is a high level of competition which, against all logic, continues to grow through the opening of yet more outlets - often by operators who are not experienced in the... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/383 Mon, 07 Apr 2008 13:45:50 PST http://franchiseesforum.com/topic/381/t/--franchisor-expanding-overseas---probably-suffer--consequen.html
   My first thoughts regarding his business are:
   
   • Does he have any idea how "different" the market will be there?
   • Does he have massively deep pockets to enable him to deal with the multitude of screw ups he will make before he gets it right?
   • Does he have sufficient depth of management to do this without starving his Australian operation?
   • What about the rest of Australia? Is 30 franchises the limit for Australia (obviously not!)
     
   
   
   My first thoughts regarding his Australian Franchisees are:
   
   • They are going to suffer because his eye is going to be taken off the ball here. Whatever marketing & operational help... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/381 Thu, 06 Mar 2008 12:44:46 PST http://franchiseesforum.com/topic/380/t/Disputes-between-Franchisors-Franchisees-are-common-.html 35% reported being involved in substantial disputes with their franchisees.
     
     (Thats according to a document received from Griffith University).
     
     So what?. So ... thats another very important piece of information that must be taken into account by prospective franchisees BEFORE they "get involved".
     
     Remember, a "substantial dispute" may imply legal action. It certainly implies much "heartache".
     
     What is the nature of the disputes that you have experienced or heard about. What are the "buttons" that create the problems?
     
     Be sure to take the steps necessary to minimise the prospects of a dispute.
     
     
     The Franchisees Advocate Group ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/380 Tue, 04 Mar 2008 14:33:37 PST http://franchiseesforum.com/topic/375/t/Franchisors-are-NOT-doing-you-any-favours-by-selecting-YOU-.html This may lead to an "ask no hard questions" approach by potential franchisees.
     
     Franchisees must remember that this is a 50:50 deal. - Whilst they may want the franchise, the franchisor also needs them. THAT'S the franchisors business - getting more franchisees.
     
     Franchisee recruitment is getting tougher & tougher - see Franchising 2008 - Crunch time
     
     In effect franchisees are the franchisors' customer, and as such the franchisees reasonable needs for information etc must be met by the franchisor. If the franchisor chooses not to meet the potential franchisees reasonable requirements, then it is best... ]]> feeds@kickapps.com (Micmarcmm) http://franchiseesforum.com/topic/375 Wed, 27 Feb 2008 14:11:07 PST