Franchise Business Consultant in Central Texas, West Texas and Rio Grande Valley

All posts by FranNet Texas

Finding the Best Franchise: Are You Missing the Gold?

“I wouldn’t want to own a cleaning service,” said one potential franchise owner. “That’s a dirty job.”

This is one example of a comment franchise consultants at FranNet hear about business such as cleaning, trash and home repair services. But the reality is that there are many seemingly unappealing and unknown franchises available that are hidden gems. They are highly profitable and many of them have a significantly lower up-front investment than the more popular and highly-visible franchise industries such as restaurants and retail chains.

“Many people are missing the gold because their perspective is limited,” explained franchise consultant, Kyle DeHaas. “When it comes to businesses like cleaning or home repair services, many people hesitate because they have a tendency to see themselves in the business’s technician role as a house keeper, trash man, etc. It’s a consumer-oriented viewpoint of business rather than a business-owner viewpoint.”

DeHaas said that in many cases this consumer-oriented thinking where the owner tries to do the technician-level work actually limits the success of the business.

“Expertise and involvement at the technician level often hurts business owners because they get too involved in the technical details and fail to sell enough or manage the business well,” said DeHaas. “What they really need to be is a good manager and sales person.”

DeHaas said the key to higher levels of success is a perspective change. They have to make the shift to a business-owner mentality where the business owner doesn’t do the technical work but rather focuses on business growth.

According to DeHaas, another perspective problem that keeps people from considering the most profitable franchise opportunities is their limited knowledge of what a franchise is and the kind of opportunities available.

“Many people think of a franchise as just a store-front operation like a Subway restaurant or an auto repair shop,” said DeHaas. “But there are many franchises available that are far more lucrative and take less investment up front.”

Some of these franchises include delivery, lawn care, party, beauty and business services.

So how do you find out which franchises have the best potential for success? DeHaas recommends starting with a good franchise consultant. While there are a number of franchise consultants available, not all offer the same in-depth consulting services.

“What sets us apart from other consultants is that we take the time to help potential franchise owners understand the scope of what’s available and think about which business model makes the most sense to achieve their personal goals,” said DeHaas. “And, the best news is that we offer this service for free through FranNet.”

To learn more about franchise consultants and how they can help you, check out FranNet Texas Southwest’s recent blog post, What is a Franchise Consultant & How Can They Help?

To sign up for a no-cost consulting session with Kyle DeHaas or another FranNet consultant in your area, fill out the form to the right.

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How to Identify the Most Profitable Franchises in Austin, Texas

If you’re looking for the most profitable franchises in Austin, you’ve landed on the right page to learn more.

While you can do research to find a list of franchises available, finding out how profitable they are is a different story. There is a limited amount of information franchises can release legally. Plus, many variables can impact a franchise’s ability to be profitable regardless of how well others have done.

“Austin and Texas in general are great places to start a franchise, but finding the most profitable franchises starts with assessing which ones are a good fit for you and doing due diligence,” says Merri Cronk, owner of FranNet Central Texas, West Texas & the Rio Grande Valley. “It’s also very important to understand the market where you are considering locating your franchise.”

Cronk advises people to go beyond internet research, which has limited information, and seek out personal counsel from seasoned experts. She says the best information is found directly from the franchisors. However, you need to know the right questions to ask, and what to look for in a franchise disclosure document. That’s where personal consulting can be very advantageous.

“You can find many lists of franchises available in Austin but what you can’t find online is personal advice about how to choose the most profitable franchise that’s best for you,” said Cronk. “When you speak directly to a franchise, they may just tell you what they want you to know, and it’s hard to know which ones are trustworthy. But, if you know the right questions to ask and the details to research, you will be able to make a much better choice.”

Because of this, Cronk and her team offer no-cost franchise consulting services for those interested in investing in a franchise.  In addition to helping you find a trustworthy franchise, FranNet consultants can help you assess your readiness to invest in a franchise financially and emotionally. If a match is made, they can help you walk through the entire process including the contract details. To learn more about how it works, click here.

If you would like more information on how much money you can make as a franchise owner, read our blog article, “How much money can you make by buying a franchise.”

FranNet Central Texas, West Texas & the Rio Grande Valley provides no-cost consulting services in the Austin area and throughout central and south Texas to help people find the best franchises for their situation. To set up a free consultation with Merri Cronk or one of the other consultants serving the in the Austin area, fill out the form to the right.

 

 

 

 

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How to Fund a Franchise Purchase

If you’ve decided that you want to buy a franchise, one of the first questions you may ask is how to fund it. Ideally, you have enough cash saved up for the total investment outright but in many cases, additional funding is needed.

When seeking a franchise to buy and how to fund it, the first step is remind yourself that buying a franchise is really an investment. You’re really not getting into it to just own it but rather to invest in something that will deliver cash flow and ROI over the long term. Gaining clarity about that will help you better decide how much money you want to invest up front, which franchise type is best for you and which funding method will be most successful.

How To Decide the Best Way to Fund a Franchise Investment

According to franchise expert Merri Cronk, “There is not one best answer for how to fund investing in a business, because every franchise varies.”  Merri, who owns FranNet Central TX and West Texas/Rio Grande Valley says that getting funding depends on many factors. “Your personal financial situation, the amount of money you need, the franchise investment and how much risk you are willing to take on should all be considered prior to making a decision.”

The best way to figure out the option that will be most successful for you is to start with a thorough review of your current situation. First, assess your net worth and liquidity to see if you have the reserves necessary. Next, spend some time thinking about your priorities, assets you want to protect and your personal comfort factor with the potential risk of various funding methods.

Next, begin reviewing the pros and cons of each option.

Here are six ways to fund a franchise courtesy of Benetrends Financial:

  1. Self-funding – Personal savings/Use of retirement funds/ Credit card
    1. Personal savings – The easiest option to fund a franchise is using your personal savings. There are no strings attached so you will have more freedom to make your own decisions. However, if you end up draining your accounts and more cash is needed, you may not have the assets needed to get a loan.
    2. Retirement Funds – If you choose the self-funding method but you don’t have enough cash readily available, the IRA/401k rollover method offered by Benetrends is a great option because it allows the money to be used for your business growth, while maintaining your retirement funds and eliminating all the fees and taxes associated with cashing out an IRA/401k. The downside is that if your business ends up struggling, your retirement funds could be at risk. If you decide to use this option, be sure to use an organization like Benetrends to make sure it’s set up and maintained properly.
    3. Credit Card – Another option is to use the available balance on your credit cards. While this is an easy way to go, it many times ends up being one of the most expensive due to high interest rates. Maxing out credit cards can also leave you in a situation where you can’t obtain additional funding.
  2. Family and friends – Many times relatives and friends are willing to invest in your business for a percentage of the profits or regular loan payments with interest. As long as business is going well and you can pay back the money, this can be a great option. However, if the business is not making profits as fast as projected and you end up not being able to pay on time, this can lead to unhappy family dynamics at the Thanksgiving dinner table. One way to lessen the burden on family is to use a crowdfunding site that allows you to collect funds from friends and small investors in addition to relatives.
  3. Franchisor loans – In some cases, franchisors will finance all or part of the loan for you to invest in their franchise. One advantage of this system is that it’s easier to get approved than outside loans and the franchisor will guarantee the loan in many cases. However, the terms vary greatly among franchises so it’s best to review other options as well before working out the details with the specific franchise you are purchasing. Also, very few franchises offer this as an option.
  4. Bank Loans – Traditional bank loans can be challenging to get because the failure rate of businesses is so high. However, the likelihood of getting approved is much higher if your loan is backed by a personal asset such as your home or property. A home equity loan can serve this purpose but you could lose your home if your business struggles.
  5. Small Business Administration (SBA) Loans – While these government-backed loans are actually made by traditional banks, the good news is they are easier to get because the SBA backs a portion of the loan. There are several types of SBA loans available. To learn more about them and determine which one is best for you, visit the SBA website.
  6. Micro Loans – These loans are usually between $35,000 and $50,000 and are often provided by non-profit community organizations. The pros of these types of loans are that the lending organization usually provides assistance and training for the business owner to maximize their ability to succeed. A con is that many micro lenders require you to personally guarantee the loan so it can be risky if the business isn’t successful.

As you can see, there are many great options to get the funding you need to invest in a franchise business.

If you would like more details and personal guidance on the best funding options for your specific situation, we welcome you to contact one of our FranNet consultants. They know the market inside and out and have a great track-record of assisting individuals on their path to entrepreneurship. The best news is that they provide this guidance free of charge. To find a consultant in the Central, West Texas or Rio Grande Valley, click here.   

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What is a Franchise Consultant & How Can They Help?

If you’re interested in learning about investing in a franchise or ready to buy one, a quality franchise consultant can help assess your readiness, provide advice and help you find the franchise that best meets your goals.

In simple terms – a franchise consultant is a good deal!  In this day and age, everyone wants a large sum of money to provide coaching or consulting services. The franchise consultants at FranNet provide consulting, educational resources and professional references free of charge to help you through that first decision of whether or not to buy a franchise to the final closing of the deal. They know the business inside and out so can save you an enormous amount of time and help you avoid mistakes. FranNet consultants also vet franchise opportunities to make sure the opportunities they send your way are quality organizations.

“Buying a franchise can be intimidating all by yourself but with the help of a consultant to walk you through it each step of the way, it’s much easier,” said Merri Cronk, owner of FranNet Central, West Texas & the Rio Grande Valley. “We also find that franchisees who take advantage of our consulting services have a much higher success rate.”

So what can you expect from a FranNet franchise consultant? When you first contact FranNet, a consultant will meet with you to assess your situation and answer questions. If investing in a franchise seems to be the right choice for you, the consultant will walk you through the process of finding a good match and working out the deal. To get more details on how that matching process works, read our article, “How we help.”

When you meet with a FranNet consultant, here is a list of questions they can help you answer:

  • How much does it cost to buy a franchise?
  • How much money can I make?
  • Is franchise ownership a good fit for me?
  • Do I need industry experience?
  • Should I buy a traditional business or a franchise?
  • Which is the best franchise to buy?
  • How do I make sure the franchise deal is favorable?
  • How do a I manage the legal aspects of a franchise deal and business structure?
  • How should I structure my business?
  • Are other franchisees in the area competition for me?
  • How can I tell if the market is saturated?

In summary, taking advantage of a franchise consultant is smart strategy and will increase the level of your success.

To get started with FranNet’s no-cost consulting services, contact us by filling out this form.

 
 
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How to Choose the Best Franchise

With so many franchises for sale in today’s market, many investors are left wondering how to choose the best franchise.

The first step is to clarify what you mean by the “best” franchise. For some, “best” means profitable. That’s important but if the franchise isn’t ethical, then the so called “profitabity” means nothing. So in reality, the first thing you need to be concerned about is finding a franchise that is ethical. They need to be upfront about their business model and not try to “fool” potential franchisees into signing a contract that is unsuitable for them.

So how do you know if the franchise is ethical? Here are some ways to decipher a good franchise from a bad one and find the best franchise for you.

  1. Look for franchises that are members of franchise trade associations.

Just like professionals such as lawyers and accountants belong to associations that lay out best practices and regulations for the industry, there are also associations for franchisors such as the International Franchise Association. Associations like these usually have membership requirements and a code of ethics that members agree to.

  1. Work with a no-cost franchise consultant.

One of the great advantages of working with a quality franchise consultant is they know the franchise business well and watch for unethical franchises. Some consultants also thoroughly vet the franchises they connect potential franchisees to, which provides added peace of mind. It also saves time because much of initial investigation is done.

  1. Talk to current franchisees.

Once you identify a specific franchise, you can investigate more. If you really want to find out what it’s like to work with a particular franchise, there is no better source than other franchisees within that franchise.

To get the opinions of other franchisees, you will likely have to contact them directly to determine whether the business you are considering is a good franchise to buy. When you talk them, be sure to ask about their relationship with the franchisor, how much support they receive, etc. Remember, they were once in the same position that you are in now, and most will be happy to provide advice.

  1. Watch for problems in the agreement.

If everything checks out ok after you’ve done your research and you’re ready to move forward, the next step is to make sure the franchise contract covers the bases. Because franchise contracts can be somewhat complicated with a number of complex legal matters involved, it’s always a good idea to have a lawyer who specializes in franchises to review the agreement before you sign it.

If any part of the agreement is unclear, or if you don’t understand something, make sure to get your lawyer to explain it to you before you sign. Also, if there seems to be anything missing in the contract, make sure you ask about this as well.

Only sign an agreement that fully explains the responsibilities of both the franchisee and the franchisor, and be wary of any claim or guarantees that a franchisor might make about your potential earnings. While it may be possible to make some projections, a franchisor can never guarantee earnings – and in fact, it’s illegal to do so.

While the franchisor will understandably want to make the sale at this point and get you started in running your franchise, you should never at any point feel like you are being put under undue pressure to sign the contract. If you’re feeling pushed to sign an agreement, you should take this as a red flag.

More Helpful Information

If you’re looking for more information about how much money can make as a franchise owner, check out our blog article, “How Much Money Can  You Make Buying A Franchise.”

To find reputable franchise opportunities that have already been vetted by FranNet, visit our resales page.

If you would like personal guidance on how to find and choose the best franchise to achieve your goals, we welcome you to contact one of our FranNet consultants. They know the market inside and out, and have a great track-record of assisting individuals on their path to entrepreneurship. The best news is that they provide this guidance free of charge. To find a consultant in the Central, West Texas or Rio Grande Valley, click here.

 

 

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