Choosing the franchise business that may be best suited for you requires a fit on three separate fronts: An organization fit (see previous blog), an attribute fit (future blog) and a business model fit, our topic of discussion today.
There are six areas to help determine if there is a good business model fit:
1. Facility. Make sure you are comfortable with where you will do business from—a retail space, an industrial space, mobile, home-based, etc.
2. Employees. The people that work for you are there with you everyday. You must be comfortable with the type of people working for you. Are they ‘blue collar’, professionals, salaried, hourly, full-time or part-time? The business you choose will determine the kind of people that work in the business. People are your most important asset and as such you need to be ‘in-tune’ with the people working for you.
3. Customers. Every business attracts different types of customers. There are customers who appreciate and value different things, price, quality, service, experience. In your business there could also be many customers with small transactions and a few customers with large transactions. Be comfortable with the type of customers and the transactions that your business will bring.
4. Products and services. Some businesses sell products, some sell services and some may sell both. You have to be comfortable with what your business is selling. After all your passion for your product and service will be essential in your success.
5. Sales. The scope and size of your potential business is important as it will help you achieve your goals and objectives. How you realize that potential and opportunity is equally important. How do you grow this business, is it through a wholesale distribution, a retail store, over the internet, door to door selling etc. It is one thing to have the potential but important to know how to realize that potential and your comfort in being able to do that. In every business you have to sell otherwise your business isn’t going to grow, but the intensity may vary and too often people get into businesses that require heavy sales and they freeze and never get out.
6. Financial. Obviously the economics have to make sense. Your ability to afford the business, your ability to grow the business to a size that allows you to meet your goals and objectives are important. Your financial metrics have to make sense as you choose your business.
It is not important that there be a 100% match in all six areas, however, you must be comfortable that there is sufficient fit between you and the business. The six areas of a fit also have varying degrees of priority to different people and you have to determine if all six areas are equally important or some areas have greater importance to you than others.
For example, at Grins 2 Go® (www.Grins2Go.com) we are mobile/home-based business, with 1-2 employees, our customers are of varied size of transactions but they all live and work in the community. Our product is capturing happy memories that everyone needs and wants and the opportunity for growth is tremendous and is realized by networking, marketing and selling and to top it off, our investment is modest.