Tom’s Franchise Information Blog

Starting a business of any kind is exciting. The great thing about a franchise business or others that are set up similarly is that if the business opportunity provides the proper training and systems, a person with no experience or special ability should be able to acquire the skills needed to succeed. After all, the premise of a successful business model is the ability to duplicate. The last thing you want to worry about is a potential franchise business issue that could affect your income and profit.

You open your business with one goal in mind… and that is to make money, right? Absolutely! Guess what? The absolute number one thing you must keep in mind is that the number one goal of the Franchisor is exactly the same! I know, you are thinking, well, no kidding I already knew that! But, did you really? Do you really know what that means to you? Have you really thought about how their goal of profitability and your goal of profitability are two entirely different goals? You must understand that since these goals are divergent, decisions made by the Franchisor are made with only ONE goal in mind - THEIR profitability.

The Franchisor will say that their success depends on your success. That is only partially true. Sure, they need open units and happy Franchisees to expand, but remember, they make their money off your sales - the TOP line. The business issue for you is that driving top line sales does not always translate into bottom line profits for you. For instance, deep discounting of products, while increasing your top line sales, could severely impact your cash flow and your bottom line. Also, adding additional units in your market will increase the top line sales for the Franchisor, but it could severely impact your sales and profits. In the Franchisor profitability model, two units producing $500,000 each in sales, is better for the Franchisor than your single unit producing $750,000 in sales, even though the decrease in sales impacts the profitability of each unit. This has become a major issue in the franchise community over the years.

There is no reason to be bitter, resentful or angry about it. It is part of the franchise business world. Too many people enter into a franchise or business opportunity and expect everything to be done for them or handed to them. Always remember that it is a business for your Franchisor as much as it is a business opportunity for you.

While there are great Franchisors out there who truly care about Franchisee success, you must realize that they care about their profitability first. When reviewing opportunities make sure they really do care about YOUR bottom line. Unfortunately, you will never really find out if that is true until you are open and operating your business. It may even take several years before it becomes an issue. Hopefully, it never does.

That is why the best and most successful direct sales and network marketing entrepreneurs work to ensure the bottom line success of their team. Their level of success is dependent upon assisting and helping each other attain as high a level of success as possible. Done properly, a true network marketing system, with proper support can produce great results, without a lot of the costs and risks associated with the start up of a typical franchise business. Both models work. Find the one that works best for you.

A current successful entrepreneur and multi-unit franchisee since the days of partially financing his first franchise fee on a credit card over 16 years ago, as the initial franchisee of a restaurant concept, David Kajganich has continually sought lucrative opportunities that are in the early stages of success. His goal and purpose is to help and mentor others to achieve the success of their dreams.

When the right opportunity presents itself, you need to go for it. There is no greater feeling than to help and watch someone succeed through sheer will, determination and persistence. As a team, we succeed together!

I love the concept of franchising and, while i am still a franchisee, I am always looking for an opportunity that provides the same benefits, but without the high costs and risks. A company with true vision and tremendous income potential has emerged. Your future awaits! Go for it!!

http://www.NoFranchiseNeeded.com

Nobody cares how much you know until you show them how much you care.

Useful Links:

We all need a little help when it comes to sorting out our debt.