For 20 years I’ve been informing and educating people about income replacement, wealth creation, and secure retirements from owning franchises. I’ve observed a pattern of common mistakes people can make when evaluating franchise opportunities. Here are different ways to avoid the most frequent dream snatchers.
1. Having an employee mindset
Solution: Change to an investor mindset
A business is both an asset and investment that can build equity and generate cash flow. It is not a job (unless you want it to be one). It’s better to evaluate a franchise more like you would a stock or a piece of investment property. Franchised businesses are unique investment opportunities.
2. Judging the “book” by its cover
Solution: The very best advice I have for anyone considering a franchise is simply to have an open mind. This is paramount to selecting THE right business for you.
People tend to judge the business by what the business sells. For example, a roofing franchise. The assumptions that are immediately formed include: I know nothing about roofing, I’m not climbing on any ladder, I’m not passionate about roof shingles – ugh!, and so on.
FOCUS ON THE ROLE OF THE OWNER!
The roofing franchise is actually a marketing and technology business that happens to sell roofing services. It has an executive model business where the owner is to build the culture, select his/her team, lead the organization, and run the business by the numbers.
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