As the franchise development director at Great Clips, I talk to a lot of prospective franchisees. Some know owning a walk-in hair salon franchise business is exactly what they want and think they’re ready to sign. Others have narrowed their choices and now want more detailed information before making a final decision.
And then there are the “perpetual prospects,” frozen with decision paralysis due to the overwhelming number of choices—more than 4,000 franchise brands in the U.S. alone! The difficulty of selecting just one—and for that matter, the “right one”—is understandable.
An article in CO—, the U.S. Chamber of Commerce's online publication, asked franchise experts for their best strategies for choosing the right franchise. I generally agree with their suggestions and have some ideas for making each strategy more effective.
SHOP AROUND
“With thousands of established franchises to select from, where does an entrepreneur start their journey? The answer is simple: tradeshows and expos. In addition, prepare for some cold calling.”
BETH: While attending tradeshows and expos can be helpful when considering a franchise business, I don’t think they should be your starting point. Instead, begin online by visiting the websites of the franchisors you’re considering. Granted, the information is definitely one-sided, but you can take it at your own pace and identify patterns for the kind of information you need to know—cost of investment, franchisee resources, corporate leadership, etc.—making it easier compare apples to apples.
BOTTOM LINE: I often represent Great Clips at tradeshows and expos, so I know how valuable—and fun—they can be to connect to franchisor representatives. But they don’t need to be your first stop. Build up your foundational knowledge first so you can effectively compare and contrast between the concepts.
And cold calling? Sure. Chances are whomever you talk to (or more likely, leave a message for) will want to set up an appointment to chat later, but how they respond will tell you a lot about how the franchise home office operates.
MORE: Are franchisors too picky when picking future franchisees?
RULE OUT FRANCHISEES THAT DON’T ALIGN WITH YOUR VISION
“Pick a franchise business that offers goods or services you’re passionate about and that harmonize with your values.”
BETH: I agree with some of this concept but would reword it: Rule out franchises that don’t align with your values. Make sure the organization reflects what matters to you—like trustworthiness or kindness or accessibility.
However, you shouldn’t only look at businesses that provide a service you’re passionate about. For example: porta potties. Few dream of building a portable toilet empire, but if you understand the business model, align with the values of the company, and appreciate that in the right situation, a product like porta potties can in fact make the world a better place (we’ve all been there, right?), then that might be a franchise you can be passionate about.
At Great Clips, even though our franchisees own one or multiple walk-in hair salons, we don’t require them to know how to cut hair or have experience in the salon business. We do want them to align with our values of delivering a great customer experiences, supporting and celebrating their staff, and engaging with their community.
BOTTOM LINE: Are you comfortable with the highest values of the company? Even more important, can you tell what those values are when you talk with franchisees and corporate leaders? If yes, it might be a good match.
KNOW WHERE TO TURN FOR HELP
“Prior to purchasing a franchise, consult with an attorney... a franchise broker... an accountant and/or tax planner. Don’t forget about the parent company, either.”
BETH: I give a thumbs up to most of this. Consulting with experts is never a bad idea. However, if you’ve read the agreement and thoroughly researched the company, attorneys or accountants may not be necessary before signing. Rather, you may want to source these experts later in your business cycle.
Brokers can be helpful if you’re stuck finding a business that matches your skills and values. Make sure you’re working with someone who has your best interests in mind and not just presenting options that would benefit them.
And, yes, ask the franchisor’s corporate office to point you toward resources and connect you to other franchisees in their system. If they are reluctant to let you talk to existing franchisees, that should tell you something,
BOTTOM LINE: Do your homework. Sometimes having too much information can slow your decision-making, but if you need to feel comfortable that you understand the dynamics of the relationship you’re entering into, outside expertise can be helpful.
Are you just beginning to research franchise opportunities, or have you been considering it for some time? I'd be happy to discuss what it's like being a franchisee of a no-appointment hair salon. During our qualifying conversations, I can connect you with current Great Clips salon owners, so you can hear directly about their experiences. Please feel free to reach out to me.
MORE: Is Great Clips right for you?
Beth Nilssen
Director of Franchise Development | Great Clips, Inc.
800-947-1143 | [email protected]