• You've found the business or franchise you like.
• 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 "successful" franchises in existence is only part of the story. How long did they take to become successful? Can you rely on those same circumstances existing for you, resulting in similar timing?
Purchasing a business or franchise may be full of surprises - Don't get caught!
Michael Marcus - The Franchisees Advocate Group
Saving Franchisees. Assisting Independent Business. BEFORE it's too late!
The Franchisees Advocate Group - Australia
Business and Franchise Help - Australia
• 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 "successful" franchises in existence is only part of the story. How long did they take to become successful? Can you rely on those same circumstances existing for you, resulting in similar timing?
Purchasing a business or franchise may be full of surprises - Don't get caught!
Michael Marcus - The Franchisees Advocate Group
Saving Franchisees. Assisting Independent Business. BEFORE it's too late!
The Franchisees Advocate Group - Australia
Business and Franchise Help - Australia
