Business Planning | May 2, 2008

Eyes Wide Open: Tips for Franchise Buyers

Posted by Joanna Meiseles at 5:43 PM

When buying a franchise, it's easy to fall into a trap that makes it difficult to make an educated and informed decision. Through the franchise sales process at Snip-its, I see many of these mistakes made by even the best of prospects.

Buy with your head, not your heart. It's great to be passionate about your business, but passion is not enough to ensure success. You'll want to carefully investigate the business, speak with existing franchisees and the support team, review the disclosure documents thoroughly, and compare your business to other businesses in the same industry, investment level, real estate market, etc. Prove that it is a smart business decision, not just a passionate one.

Make a full commitment. Many franchisees want to keep their corporate jobs until their new venture is off the ground and thriving. While this makes sense logically, it may not be practical. Any new business requires a great deal of energy and attention, especially at the outset. Be prepared to devote yourself fully to your new business, and don't be fooled into thinking you have enough energy and passion for two jobs.

Support the operations model -- don't reinvent it. Franchisees are entrepreneurs by nature, and that can be both good and bad. Entrepreneurs are notorious for wanting to reinvent the wheel, but a franchisee who wants to do things his or her own way is destined to clash with the franchisor, not to mention violating the franchise agreement. If you are buying a good franchise, the operating model has probably been well-proven by the time you come on board -- in fact, it's one of the primary assets you are paying for by buying the franchise. Wait until you have some experience before deciding you are the expert.

Be realistic. Some people think that buying into a franchise is a foolproof way to operate a successful business. It's great to be optimistic, but be careful to understand that YOU will be running the business, not the franchisor, and some franchises do fail. Be prepared for the worst-case scenario, and have a back-up plan in case your business struggles more than you anticipated.

Know what the franchise agreement promises. If you actually read the disclosure documents literally, you will see that franchise agreements generally provide very little to the franchisee beyond licensing the right to use the company's system and trademark for a period of time in a specific territory. There is actually not much else that the franchisor is required to provide. Although most franchise companies support their franchise owners with their marketing, operations, and real estate, it is usually not a legal requirement. Be sure you understand exactly what you are getting when you buy a franchise.

By identifying the potential pitfalls, you can avoid them. Franchising can be a rewarding and profitable way to get into business, so go in with your eyes wide open and minimize your risk.

If you are a franchisee or a franchisor who has experienced some of the mistakes listed here, I'd love to learn from your stories. Write me!

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Success | March 3, 2008

Do Your Homework to Validate Success

Posted by Joanna Meiseles at 2:52 PM

If you've made the decision to open a franchise, you'll need to do your homework before signing on with any franchise company. Part of the due diligence practice involves a process known in the industry as "validation." Validation is the process of speaking to existing or past franchisees of the system you are looking at to determine your likelihood of success.

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Business Planning | February 7, 2008

Franchising: Five Reasons to Explore First

Posted by Joanna Meiseles at 12:48 PM

Why join a franchise system, as opposed to going it alone and starting your own brand? Below are five good reasons to consider a franchise as your next entrepreneurial venture.

Benefit of the Larger System -- When you join a franchise organization, you get the benefit of learning from other entrepreneurs who have done exactly what you will be doing. In franchising, we say "you're in business for yourself, but not by yourself." This means that you have an entire franchise organization, to call on for advice, best practices, and support.

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Business Planning | January 28, 2008

Five Requirements for a Successful Franchise Model

Posted by Joanna Meiseles at 11:55 AM

Lately, it seems as if everyone is franchising their business. In fact, according to Franchise Consultants, Inc., a new franchised business opens every eight minutes of every business day. You can get your cat groomed, your poop scooped, or your dog walked; a hotdog, pizza, salad, tacos, yogurt, ice cream, or fondue; your hair cut, nails trimmed, back rubbed, body tanned, or waist whittled; your radiator lubed, tires rotated, car painted, battery changed; kids tutored, teenagers prepped for college, grandma babysat; carpets cleaned, basement finished, lawn trimmed, windows wiped, pipes drained and you can even do your taxes -- all from a franchised business.

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| January 7, 2008

Five Questions to Ask Yourself Before Buying a Franchise

Posted by Joanna Meiseles at 10:17 AM

Buying a franchise is a great way to go into business for yourself but not by yourself. It's the best of both worlds. You get the autonomy of being your own boss while having access to the support and systems provided by the franchisor. Starting any business, whether franchised or not, is a huge undertaking -- one that should be well thought out and planned as carefully as you would plan the design for a building or home. Here are five questions to consider before buying into a franchised business.

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Success | November 27, 2007

Six Keys to Running a Successful Business

Posted by Joanna Meiseles at 9:41 AM

Running a business is a bit like doing a jigsaw puzzle. The pieces must fit together perfectly in order to complete the puzzle. If you are missing a piece, or if you have to pound the pieces together, you can't complete the puzzle. All of the pieces are interconnected, so they can't stand alone. In order to run a successful business, there are six puzzle pieces that must all be perfectly arranged and executed. These are the six pieces critical to the success of Snip-its salons, and I believe they are transferable to just about any business.

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| November 7, 2007

The Value of Face-to-Face Meetings

Posted by Joanna Meiseles at 9:53 AM

For the last two years at Snip-its, we have held an annual franchisee convention at our headquarters in Boston. This year, however, we decided to do something different. Instead of one big convention, we held three regional meetings in Boston, Atlanta, and Dallas. A change from past years, we thought this was the best way to reach out to our owners and see things from their perspective. It was also important to re-establish the human connection and communicate together in one room.

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| October 22, 2007

Getting to the "Why"

Posted by Joanna Meiseles at 2:16 PM

Why does an entrepreneur start a business? What compels him (or her) to take an inspiration or an idea and turn it into a business? Certainly it's not for the money -- most entrepreneurs would be more financially secure with a regular job. It's probably not for the flexible work schedule -- although it is nice to be in control and choose which 16 of each day you want to work. Surely it's not for the fame and fortune -- most entrepreneurs never achieve that! So why do we do it?

Any entrepreneur can tell you what drives them -- it's something from inside -- maybe a need to fill a niche, maybe a strong desire to accomplish a certain goal, maybe an inner drive to change the world. Whatever the motivator, it is important to articulate it and keep it alive as you build and grow your business.

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Business Planning | October 8, 2007

Things I'm Glad I Didn't Know

Posted by Joanna Meiseles at 7:59 AM

When asked to write a blog about four things I wish someone told me before I started my business, I thought about what those things might be and as I pondered the issue I realized something interesting. My inexperience and lack of knowledge in the beginning was a blessing in disguise. If I had known then what I know now, I may never have taken the plunge and become an entrepreneur. Here are the four things I'm glad no one told me before I started Snip-its.

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Success | September 24, 2007

The "Aha" Moment

Posted by Joanna Meiseles at 10:18 AM

I recently had the pleasure of participating on a panel of entrepreneurs at the Inc. 500 conference in Chicago. The entire event was a fantastic learning and networking opportunity, and I especially enjoyed the panel I sat on. I was joined by my fellow bloggers Gigi Lee Chang of Plum Organics, Clint Greenleaf of Greenleaf Book Group, as well as Jack Stack, CEO of SRC Holdings and author of The Great Game of Business. Each of us was asked the same opening question: When did you have your "aha moment" when you knew you had made it?

We all answered the same way. It was quite amazing! None of us felt like we had made it yet. We all felt like we were still struggling, still on the road to success, but not there yet. I think there is an important lesson there. Maybe it's that you never want to rest on your laurels and get too complacent. Maybe it's that it's normal to feel insecure and doubtful. Or maybe it's that you never really know what success looks like when you are still in the trenches of running and growing your business.

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