Despite what people may think, you need to spend just as much money - or even more - maintaining a business franchise as purchasing one. However, because of the large investment of the initial purchase and franchise profits being too far into the future to be of any use to you now, you will probably find yourself lacking in financial support. Without that money, your business may meet its untimely end before you can even reap the benefits.
While it is impossible to magically make more money appear out of thin air, you can maximise what you already have. Ideally, you should give yourself a manageable and realistic budget; however, that might be difficult in today’s global economy where every second a competitor can get ahead of you if you’re not careful. Therefore, this budget should not only save you money for the long term, but also maintain your edge in the market. Below are few tips to help you get started.
Before you buy a business franchise…
You should analyse your capital and your future plans in franchising. Can you afford this billion-dollar franchise and, more importantly, can you continue to maintain it until you reach your goals? If not, it may be better for you to look for low-cost franchises. Some people believe in the mentality of “go big or go home,” but that can’t be any further from the truth. A low-cost franchise still has the potential to be as good or even greater than the franchises that were, at the time, more expensive. All you need is to carefully plan your franchise’s future.
Rely on your franchisors
Every success - and by extension, failure - felt by your company will also affect those that invested in your franchise, namely your franchisors. In that sense, most franchisors take the hands-on approach and lend you aid to ensure that they don’t end up losing money. This is an opportunity for you to save money by letting them provide assets that would otherwise make you go over your budget.
Dream big, start small
Virtually anyone who buys a franchise dreams of great fortune, international fame, or any number of goals so large that they may at times seem impossible. Making these goals realistically possible has one prerequisite: patience. You need to take your time to build the foundations of your franchise. Want your franchise to have foreign branches? It’s certainly not as simple as securing a plot of land and starting construction of your physical office. You’re more likely to go bankrupt before you can get any kind of profit off such a large endeavour. That is why you need to start with small projects and build up from there. Open a branch in another city first, or expand the original office instead. Take these careful steps before you sprint head on towards your goals.
Make full use of social media
Social media like Facebook, Twitter, and LinkedIn are completely free for anyone to use, while granting you access to an incredibly large audience. Setting up and maintaining an account or two will take at most an hour off your day. You only need to keep your pages updated, interact with customers, and maximise every tool given to you once you’ve filled up that registration page. This is the closest you can get to free marketing and developing customer relations.
Believe in “just enough”
While your franchise might have the capacity to churn out tons of products or services, the cost may be bigger than your profits. This is true for internal affairs as well. Will you be able to sell every item your company produces or will they all go to waste? Does your company really need that brand new but expensive coffee machine to finish your daily tasks? Make sure your funds are only allocated for your essentials, with luxuries coming in once you are financially secure.
Following these tips ensure that owning a franchise with a tight budget is feasible. With so many obstacles in your way - like accounting for franchising fees - you might still be a little confused on how to proceed with your franchise, but we can help you. Schedule a consultation with us today to develop a financial strategy to keep your business running smoothly for years to come.