What To Consider Before Buying A Franchise

Here are some useful tips on what to consider before buying a franchise. Before investing in any franchise system, be sure to get a copy of the franchisor's disclosure document. Sometimes this document is called a Franchise Offering Circular. You should read the entire disclosure document. Make sure you understand all of the provisions.

Here are some useful tips on what to consider before buying a franchise. Before investing in any franchise system, be sure to get a copy of the franchisor's disclosure document. Sometimes this document is called a Franchise Offering Circular. You should read the entire disclosure document. Make sure you understand all of the provisions.

The following outline will help you to understand key provisions of typical disclosure documents. Get a clarification or answer to your concerns before you invest.

Business Background: The disclosure document identifies the executives of the franchise system and describes their prior experience. Consider not only their general business background, but their experience in managing a franchise system. Also consider how long they have been with the company. Investing with an inexperienced franchisor may be riskier than investing with an experienced one.

Litigation History: The disclosure document helps you assess the background of the franchisor and its executives by requiring the disclosure of prior litigation. The disclosure document tells you if the franchisor, or any of its executive officers, has been convicted of crimes involving, for example, fraud.

Bankruptcy: The disclosure document tells you if the franchisor or any of its executives have recently been involved in a bankruptcy. This will help you to assess the franchisor's financial stability.

Costs: The disclosure document tells you the costs involved to start one of the company's franchises. It will describe any initial deposit or franchise fee, which may be non-refundable, and costs for initial inventory, signs, equipment, leases, or rentals.

Restrictions: Your franchisor may restrict how you operate your outlet. The disclosure document tells you if the franchisor limits the supplier of goods from whom you may purchase, the goods or services you may offer for sale, the customers to whom you can offer goods or services or the territory in which you can sell goods or services.

Terminations: The disclosure document tells you the conditions under which the franchisor may terminate your franchise and your obligations to the franchisor after termination. It also tells you the conditions under which you can renew, sell, or assign your franchise to other parties.

Training: The disclosure document will explain the franchisor's training and assistance program. Make sure you understand the level of training offered.

Advertising: You often must contribute a percentage of your income to an advertising fund even if you disagree with how these funds are used. The disclosure document provides information on advertising costs.

Current and Former Franchisees: The disclosure document provides important information about current and former franchisees. Determine how many franchises are currently operating. A large number of franchisees in your area may mean increased competition. Pay attention to the number of terminated franchisees. A large number of terminated, cancelled, or non-renewed franchises may indicate problems.

Earnings Potential: You may want to know how much money you can make if you invest in a particular franchise system. Be careful as earnings projections can be misleading. Insist upon written substantiation for any earnings projections or suggestions about your potential income or sales.

Financial History: The disclosure document provides you with important information about the company's financial status, including audited financial statements. Be aware that investing in a financially unstable franchisor is a significant risk; the company may go out of business or into bankruptcy after you have invested your money.

Hire a lawyer or an accountant to review the franchisor's financial statements. Do not attempt to extract this important information from the disclosure document unless you have considerable background in these matters. Your lawyer or accountant can help you understand the information.

 John Mussi is the founder of Direct Online Loans who help UK homeowners find the best available loans via the www.directonlineloans.co.uk website.

How To Select A Franchise

Here are some useful tips on how to select a franchise. When selecting a franchise, carefully consider a number of factors, such as the demand for the products or services, likely competition, the franchisor's background, and the level of support you will receive because like any other investment, purchasing a franchise is a risk. You will do well to consider the following items before selecting a franchise:

Demand: Is there a demand for the franchisor's products or services in your area? Is the demand seasonal? Is there likely to be a continuing demand for the products or services in the future? Does the product or service generate repeat business?

Competition: What is the level of competition? How many franchised and company-owned outlets does the franchisor have in your area? How many competing companies sell the same or similar products or services?

Ability to Operate the Business: Will you be able to operate your outlet even if the franchisor goes out of business? Will you need the franchisor's ongoing training, advertising, or other assistance to succeed? Will you have access to the same suppliers?

Name Recognition: A primary reason for purchasing a franchise is the right to associate with the company's name. The more widely recognized the name, the more likely it will draw customers who know its products or services:

Training and Support: Another reason for purchasing a franchise is to obtain support from the franchisor. What training and ongoing support does the franchisor provide?

Franchisor's Experience: Many franchisors operate well-established companies with years of experience both in selling goods or services and in managing a franchise system. Carefully consider how long the franchisor has managed a franchise system.

Growth: A growing franchise system increases the franchisor's name recognition and may enable you to attract customers. Make sure the franchisor has sufficient financial assets and staff to support the franchisees.

John Mussi is the founder of Direct Online Loans who help UK homeowners find the best available loans via the www.directonlineloans.co.uk website.

Selling From Your Heart...a Sales Approach for Franchise Professionals

WE know that the profession of franchise sales is an honorable one...and that many franchise sales professionals are great at what they do...but let's face it...for many people the word "selling" is a mighty nasty word...and the idea of dealing with a "salesperson" is akin to having a root canal!

Even you and I have experienced obnoxious salespeople who have turned us off...made us cringe...and even stopped us from pursuing a purchase that we really wanted.

So how can we expect our prospects to trust us if we ourselves have had a poor experience or two?

Well, if you're anything like the franchise sales professionals that I know...you're always up for a challenge!

And what could be more challenging than the current climate that we find ourselves in? This is the era of the uninvited dinnertime Tele-Marketer and the "Do Not Call" Registry...an era characterized by educated prospects who want to "invite" sales professionals into their lives...not be bombarded by them!

And what does that create for us...the franchise sales professionals of the world? It creates a wonderful opportunity to prove that franchise salespeople are professional, and relationship-oriented and different from the rest! And when we handle our jobs in this way, it creates an opportunity for us to meet and surpass our quarterly sales goals at the same time.

Are you in?

I thought so!

So, here we go...

Step 1-KNOW YOURSELF AND YOUR PRODUCT OR SERVICE

What makes you unique and what makes you tick? Why would prospects want to partner with you? Is it your knowledge? Or, is it your style? Is it the years of experience that you have in your business? Perhaps it's your openness and your ability to keep conversations going for a long, long time.

Similarly, what is it about your franchised product or service that is unique? What can you tell someone about your concept that will make them curious and want to know more? What is it that your company offers that no other company can match?

Step 2-GET CLEAR ON WHO YOU WANT TO ATTRACT

Who are your "Ideal Prospects"? Have you profiled those individuals? What qualities do they have? What skillsets? What traits? Create an "Ideal Prospects" checklist. List all of the qualities that you are looking for and keep it in full sight. Be open to the idea that you can ADD or SUBTRACT from this list as your business profile changes. Imagine what it would be like to be in a business partnership with these types of people.

Step 3-LOOK FOR YOUR "IDEAL PROSPECTS" EVERYWHERE

This is like a treasure hunt. Sure, your prospects are coming to you primarily via the internet...but where else can you find them? What newspapers and magazines do they read? What radio stations do they listen to? What TV shows do they watch? What types of advertisements can you create for those media? Where might you meet your prospects in person? Do they hang out in Starbucks or at the local gym? Go ahead...seek them out!

Step 4-CREATE AN IMAGE FOR THESE INDIVIDUALS TO SEE

How can you portray yourself and your concept to your ideal prospects? What can you send them that will make them curious about your business? Should you include a picture of your flagship store or a photo of your smiling face? Can you pose a question in your copy that will make them say...Hmmm? Should your business card be strictly professional or warm and casual? If you were them, what would make YOU reach out?

Step 5-IMAGINE YOURSELF CONVERSING WITH EXACTLY THE TYPES OF PROSPECTS YOU SEEK

If you could talk with your ideal prospects right now, what would you like to find out about them? How would you introduce yourself? What questions could you ask to put them at ease? Would you listen more than you speak? What would you be listening for? What would you want them to know about you and your business? Preparation is good!

Step 6-BE A CONVERSATION STARTER

People love to talk about themselves! Ask some "open ended" questions. Listen to their responses. Listen some more. Now listen behind the words for what is not being said. It's great to come from a place of curiosity. What can this person teach you? What connections might you have? What commonalities of experience? Is this someone who might be a good fit for your business? How can you move this new relationship from acquaintainship to partnership?

Step 7-MOVE IT FORWARD

If you're feeling good about this prospect...go for it! When you're comfortable in your own skin, and obviously excited about your business, you'll inspire your prospects to want to learn more. Just be yourself. Share what inspired you to join your franchise company. Tell a fun story about how you got started. Be clear about what it is that makes your business special to you...and then move the relationship forward by inviting your prospects to take the next step.

Step 8-WATCH FOR THE 'MAGIC CLICK'

As you're conversing and moving through the process, check in with how you're feeling about this person. Are you on the same wave length? Do you speak the same language? Is the conversation flowing...or stagnant? What can you do to enliven the connection? Go ahead and do it!

Step 9-GUIDE YOUR PROSPECT THROUGH THE DISCOVERY PROCESS

Invite your prospect to 'try you on'...by inviting them in for a personal meeting. Be prepared to excite and inform them on Discovery Day. Nurture your new connection. Help them to meet others in your franchise organization and to get their questions answered. Be sure they get to watch you interacting with your team-mates...allow them to see the comradeship you feel for one another. Set a realistic timeline for discovery. Send them home with a smile and an eagerness to be awarded your franchise.

Step 10-BE READILY AVAILABLE TO THEM EVERY STEP OF THE WAY

Keep in touch with your prospects consistently. Even if they're not returning your phone calls, it's not over until they say, "no". When you sense a concern, meet it head on. Allow yourself to be easy to find and easy to work with. Go to bat for them when you can...and when you can't, let them know that. Return their calls promptly. Follow up diligently. Remain optimistic. Move through the quarter expecting the best. Be the person that stands by their side as they move from prospect to franchisee. Celebrate with them at your next annual conference!

SO HOW MUCH FUN IS THIS?

Franchise sales professionals get more opportunities than most to connect with good people, form new relationships, create partnerships, and help people to grow and prosper in a business suited just for them!

We are fortunate to be in a position to share the success of the franchising business model with exactly the right people!

Until we meet again...Happy Selling!

Flo Schell,EdM,is Founder of Franchise Coaching Systems and has been featured in Success magazine and The Wall Street Journal.

She is the former Vice President of Franchise Development for Sylvan Learning Systems. Sign up for free newsletter, "The Future of Franchising" at www.FloSchell.com. Contact information: Phone: 732-528-4385; E-mail: mycoach@FloSchell.com.
Copyright 2005, all rights reserved.

Can Indianapolis afford an NFL franchise?

Since at least 1997 only 14 years after the 63,000-seat Hoosier Dome was built for $82 million Indianapolis Colts owner Jim Irsay was publicly lobbying for a new stadium to host his team.

Although pushed back by the Pacers $175 million taxpayer-supported Conseco Field House deal, he said his turn would come. He has repeatedly said that his NFL franchise cannot survive on the revenues provided from the RCA Dome, and that a new stadium is needed sooner or later.

Its tough making big money on an NFL franchise in a market this size without taxpayers subsidizing much of the costs. Taxpayers coughed up $20 million in 1998 to enlarge the RCA Domes suites and enhance the value of its expensive box seats. This actually cut the domes capacity to 57,900 seats, making it the smallest stadium in the league. In 2003 the team ranked 27th out of 32 NFL teams in terms of revenue and 29th in value.

"We're significantly, significantly below the average (in revenue), and that disparity is growing, Irsay told Indianapolis television viewers. Yet the average determines what our expenses are with the salary cap. That's what makes things so difficult."

However, as the Cincinnati Bengals have proven, a new stadium does not ensure a better profit. Even with a new stadium, the Bengals were 24th in revenue in 2002, with only $4 million more in revenues than the Colts.

The Colts lease at the RCA Dome runs until 2013, but the team can break the deal after the 2006 season if its revenues arent greater than or equal to the median in the NFL in two out of the next three seasons. Indianapolis could require the Colts to stay by paying the difference between the teams revenues and the leagues median.

In 2002 the Colts fell short by about $13 million. Under this arrangement, Indianapolis taxpayers presently pay the Colts about $12 million per year in direct subsidies.

The long-term solution, Irsay proposes, is a new stadium with more expensive suites, club seats and ticket prices. He says the teams future in Indianapolis depends on the ability to market yourself and sell seats, particularly the expensive suites and club seats. Agreed.

The RCA Dome has 104 suites. The leagues top franchise, the Washington Redskins, offers 280. The difference in revenue between the Colts and Redskins luxury suites likely exceeds $15 million annually. Total team revenues were $137 million and $227 million, respectively, in 2002.

Certainly it behooves Irsay to shop his team to the city that gives him the best deal. During the past decade, 21 of the leagues 32 teams have received new or renovated stadiums. An average sweetheart deal is a $323-million stadium, paid 65 percent by taxpayers , that holds 69,200 spectators.

But here are the $66,000 questions for Mr. Irsay: Even with an average $323-million stadium funded two-thirds by taxpayers, can the Colts sell more suites at greater prices to bring team revenues above the NFL median? Likewise, can the central Indiana football market sustain more suites, box seats and higher prices to keep the Colts in town?

Ive been thinking of recommending that the Libertarian Party buy the naming rights to the next Indianapolis Colts stadium, but now Im having second thoughts.

At a recent sold-out home game, I was unable to sell the two extra $45-seats that I had at any price. There was no one besides ticket scalpers to give the tickets. I swallowed the $90 in losses, not to mention two grossly expensive $6 beers during the game. (Hey, I was thirsty and now have my third plastic commemorative Colts cup!)

Before a new stadium becomes economically realistic in Indianapolis, demand for Colts tickets, box seats and luxury suites must exceed their supply. This burden of truth falls on Jim Irsay, and he must meet this before taxpayers make more concessions.

Funding a new stadium with $400-plus million of taxpayer debt (excluding interest) is to gamble on the teams ability to sell itself to more fans and at a higher premium.

This will be a much harder task than giving away my extra tickets.

(Originally published on November 16, 2004)

Attorney, screenwriter, Libertarian Party activist in Indianapolis

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http://www.planetxmail.com/mle/uht.php?urlID=9&user=2757254014 Intellectual property forums make $100 billion industry accessible to innovatorsNeil ArmandThe intellectual property transfer market is now estimated to be worth over $100 billion. If you have a new idea, an invention, a new art or craft, you may be able to license it or sell it for millions of dollars. Many Fortune 500 companies are now making their intellectual property available for sale or licensing at new online intellectual-property exchanges. These companies are trying to maximize their return on research and development investment and generate a new source of revenue by licensing their unused and underutilized inventions to others.

A number of online forums, including Minnesota-based NewIdeaTrade.com
(http://www.newideatrade.com ), California-based Pl-x.com (http://www.pl-x.com ), and Connecticut-based PatentTriage.com (http://www.patenttriage.com ) now link buyers and sellers of intellectual property. The traditional transfer of intellectual property is complicated, costly, and can take up to one year. However, these online forums simplify and speed up the process for transfer of new ideas.

The Internet currently reaches more than 600 million users around the world. This makes innovators potential for exposure much higher than with traditional forms of media. The worldwide online commerce has reached $2.2 trillion in 2002 and is expected to reach $6.8 trillion by 2005. The innovators today can leverage the massive reach of the Internet and promote their new ideas to the global market without substantial marketing costs.

Additional information on how to market intellectual property is available at http://www.newideatrade.com.

Intellectual Property Professional
Global Commerce & Communication, Inc.

To Open or Not to Open a Major Franchise Business

If you are tired of working for someone else and exploring opening and running your own small business, you are probably confused about the multitudes of available business possibilities. To make matters worse, authoritative voices differ in their opinions of whether opening a major franchise business is preferable to starting an independent business.

As an owner of nine franchise businesses, I have personally experienced the benefits as well as the limitations of opening and running franchise businesses. The following is a list of pros and cons of owning a major franchise business.

1.(Pro) Pre-existing building layouts and dcor requirements lesson start-up confusion and facilitate quicker and easier start-ups.

Many pre-existing franchisors The Franchise Giver Big Daddy usually equip their new franchisees You The Little Fish with possible layout and decor drawings and requirement spec sheets, thus taking the guesswork and hassle out of trying to figure out how you are going to build-out and equip your new business.

2.(Con) Loss of creative control over business layout and dcor appearance.

The benefit of being told where and how to build and place everything comes with loss of freedom you may want to express your creative decorative expression in your business. If you want to decorate your business with freedom, research the franchise dcor rules and regulations before you purchase a franchise.

3.(Pro) Franchise agreements and structures set up to save you money on business, service or food products.

Because of the greater number of franchises, Big Daddy usually has arranged cheaper national contracts wherein you can get certain services, business or food products at a significantly reduced price. You get to save money.

4.(Con) The products and/or services you provide are regulated and controlled by Big Daddy.

These cheaper prices are usually accompanied with regulation and control by the franchisor as to what type of products and services you can or cannot purchase. In other words, Big Daddy tells you what you can or cannot buy and from whom.

5.(Pro) National Advertising included.

Well known, established franchises typically have a National Advertising campaign in place that provides TV, radio, and printed material advertising. This way, you dont have to spend a lot of your own money locally advertising your business.

6.(Con) Loss of promotion/advertising freedom.

Great national advertising promotions are typically accompanied by blanket: You will promote this product or service during this campaign ruling. Hopefully, their advertising campaigns will make sense, wont cost you too much money, and bring in more business. Sometimes it works and sometimes it doesnt.

7.(Pro) Name recognition.

Who has not heard of Baskin Robbins, Subway or GNC? If you havent, youve been living in a cave. Franchises typically have wonderful name recognition benefits to them. In other words, people will actively seek out a particular franchise wherever they go.

8.(Con) Customer holds other franchise experiences against YOU.

If a customer has had a bad experience at one franchise location, he tends to hold all of the other franchise owners responsible for that one bad experience somewhere else. In other words, Ill never go to another Subway because I didnt like the meatball sub I got at Joe Blows location.

9.(Pro) Potential for higher sales.

With the national advertising campaigns and name recognition, your franchise business has a better potential for much higher sales than a similar business with a no-name, no experience rating history.

10.(Con) Handing over a percentage of your sales to Big Daddy.

Yeah, higher sales! But ouch, you have to hand a large bulk of your sales over to Big Daddy. For every dollar you earn, your franchise fee rips away anywhere from .04 to .25. Pull your wallet out and hand it over to Big Daddy.

As with any situation in life, there are resulting pros and cons. Simply study the nature of the franchises completely and talk to other franchise owners to get a feel of whether you will want to purchase that particular franchise. If its a good fit, go for it!

Good luck and good business!

As an owner of nine franchise businesses, I have personally experienced the benefits as well as the limitations of opening and running franchise businesses. The following is a list of pros and cons of owning a major franchise business.

1.(Pro) Pre-existing building layouts and dcor requirements lesson start-up confusion and facilitate quicker and easier start-ups.

Many pre-existing franchisors The Franchise Giver Big Daddy usually equip their new franchisees You The Little Fish with possible layout and decor drawings and requirement spec sheets, thus taking the guesswork and hassle out of trying to figure out how you are going to build-out and equip your new business.

2.(Con) Loss of creative control over business layout and dcor appearance.

The benefit of being told where and how to build and place everything comes with loss of freedom you may want to express your creative decorative expression in your business. If you want to decorate your business with freedom, research the franchise dcor rules and regulations before you purchase a franchise.

3.(Pro) Franchise agreements and structures set up to save you money on business, service or food products.

Because of the greater number of franchises, Big Daddy usually has arranged cheaper national contracts wherein you can get certain services, business or food products at a significantly reduced price. You get to save money.

4.(Con) The products and/or services you provide are regulated and controlled by Big Daddy.

These cheaper prices are usually accompanied with regulation and control by the franchisor as to what type of products and services you can or cannot purchase. In other words, Big Daddy tells you what you can or cannot buy and from whom.

5.(Pro) National Advertising included.

Well known, established franchises typically have a National Advertising campaign in place that provides TV, radio, and printed material advertising. This way, you dont have to spend a lot of your own money locally advertising your business.

6.(Con) Loss of promotion/advertising freedom.

Great national advertising promotions are typically accompanied by blanket: You will promote this product or service during this campaign ruling. Hopefully, their advertising campaigns will make sense, wont cost you too much money, and bring in more business. Sometimes it works and sometimes it doesnt.

7.(Pro) Name recognition.

Who has not heard of Baskin Robbins, Subway or GNC? If you havent, youve been living in a cave. Franchises typically have wonderful name recognition benefits to them. In other words, people will actively seek out a particular franchise wherever they go.

8.(Con) Customer holds other franchise experiences against YOU.

If a customer has had a bad experience at one franchise location, he tends to hold all of the other franchise owners responsible for that one bad experience somewhere else. In other words, Ill never go to another Subway because I didnt like the meatball sub I got at Joe Blows location.

9.(Pro) Potential for higher sales.

With the national advertising campaigns and name recognition, your franchise business has a better potential for much higher sales than a similar business with a no-name, no experience rating history.

10.(Con) Handing over a percentage of your sales to Big Daddy.

Yeah, higher sales! But ouch, you have to hand a large bulk of your sales over to Big Daddy. For every dollar you earn, your franchise fee rips away anywhere from .04 to .25. Pull your wallet out and hand it over to Big Daddy.

As with any situation in life, there are resulting pros and cons. Simply study the nature of the franchises completely and talk to other franchise owners to get a feel of whether you will want to purchase that particular franchise. If its a good fit, go for it!

Good luck and good business!

As a Mind Power Leadership coach, trainer, and speaker, Ronya Banks has helped others become leaders and business owners since 1992. Frequently featured in radio, magazine and newspaper articles and interviews, Ronya helps you find the great leader within by accessing the natural power of your minds. Discover more of Ronyas proven leadership success secrets by subscribing to her Mind Power Leadership ezine newsletter at: http://www.livinginaction.com/newsletter.cfm.

Franchise Models For Less

I read an article from the Seattle Times this week about a Quiznos franchise that struggled for several weeks just to stay afloat after the owners disappeared. The manager and three employees stayed on with no pay in an attempt to salvage this sinking ship. Things got really bad when food vendors would no longer deliver on credit so the loyal employees were forced to pick up supplies, such as deli meat, from the local grocery store.

Stories like this are not typical of franchise models, but, of course, nothing is completely flawless. Franchises are the hottest business model today because they provide a proven system and product that tend to produce very high rates of success. The downside typically comes from the high start-up fees. A typical brick and mortar franchise can run between $430,000 and $750,000 with the majority going to pay for the building, equipment, and supplies. Forty percent of this cost has to come from your own (non-borrowed) funds.

Not all franchises today are brick and mortar businesses, however. In fact, there are many service franchises that can be run from your home. Entrepreneur Magazine has released its spring title of Be Your Own Boss: 231 Low-Cost Businesses You Can Start Today! Its packed with several franchises options that range from $2,200 to $50,000 in startup costs and require small ongoing royalty fees that average under 10%. A great web site for additional information on franchise options is www.franchise.com

If these start-up costs are still a little high, consider starting your own service business. There are several great ideas Dan gives in his audio Turning Your Passions into Profits. Also, stay tuned for Business Ideas You Can Bootstrap For Under $500! an e-book that will be available to all of our subscribers for FREE in a couple of weeks.

Jonathan R Taylor is the author of The Coach's Career Tips and Resources. He helps his clients Love Their Work! You can subscribe at www.careercalling.com/subscribe.htm.