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Researching a Franchise

Be Sure to Shop Around

Eight steps to choosing the perfect business opportunity.

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For an entrepreneur, reading about business opportunity programmes or attending business opportunity trade shows is like being a kid in a candy store. Each concept and product is more stimulating, dazzling and exciting than the last. It starts as an exercise in pure imagination, as every opportunity is mentally tested against your secret ambition to be in business for yourself.

If you find this mental exercise stimulating, however, you’re more vulnerable when it comes to investing in a business opportunity, because you may be manipulated by sales people who recognise your passion for business involvement. So before you reach for that credit card and buy a business opportunity, stop for a moment to consider the following.

Good Advice

These eight steps will not only protect you, but help you select the perfect business opportunity:

Step 1: Focus, focus, focus

Write down your core interests. What have you enjoyed most about current and past jobs? Contact with people, working with computers, making sales? Home in on the activities that stimulate and inspire you, and let them guide your search. Once you edit and think about your ideas, discuss them with those closest to you.

Also, consider your goals for the business.

Do you want to run it part-time or full-time? What can you afford to spend (and lose)? How will you pay for the business opportunity? What are your income aspirations? How does business ownership fit into your lifelong goals?

Keep these guidelines in mind when you either attend a business opportunity trade show or begin contacting business opportunity sellers. You’ll be surprised how easy it is to get distracted by interesting leads that stray from your goals. Above all, stay focused.

Step 2: Get organised

Before you start investigating business opportunities in earnest, take some time to prepare for the piles of paperwork the process will generate. Set up labelled files to store information about the programmes you like and don’t like, general information, notes on your personal interests and so forth.

When you receive a mailing or return home from a business opportunity trade show, sift through your plastic bag of handouts. Throw away the junk, and file the materials that interest you the most.

Step 3: Shop ’til you drop

Your challenge is to overcome every obstacle when gathering information. This entails attending trade shows, calling sellers whose advertisements intrigue you, visiting sales representatives and talking to other entrepreneurs who’ve purchased business opportunities in the past. Stay in information-gathering mode for a while, and don’t rush into buying anything.

Step 4: Develop healthy scepticism

Whenever you listen to a sales presentation, stay on guard. Expect to hear that the programme can yield thousands of rands in your spare time with only a few hours of effort each week. But be realistic! Sorry to break the news, but no matter what business opportunity sellers tell you, there’s no such thing as easy money. It’s actually hard work to be successful, and if you think otherwise, you are hereby instructed to leave your credit cards and blank cheques at home.

Step 5: Information, please!

As you find programmes that fit your criteria, ask questions of the sellers . . . and keep asking. No detail is too small to investigate further. Take a notepad with you to all sales presentations or trade shows; taking notes will help you remember the questions you need to ask. Some to start with include: Exactly what kind of work will I do in this business? What if no one responds to my marketing efforts? If it doesn’t work for me, will you [the seller] help? Is there a limit to the help you’ll provide? Have you ever been sued by one of your buyers or investigated by a state agency? How long is the training? Are there any circumstances under which my money would be refunded?

Step 6: Check out the company

This is not an easy step. There are a number of places to go to enquire about the legitimacy of a business opportunity seller; unfortunately, they may not have any specific information for you. The best sources of information about a business opportunity are the people who have actually purchased the programme. Ask the seller for a list of buyers in your area. Don’t accept just one or two referrals – they may not give you an unbiased story. Get a full list instead, and call the contacts. Ask them: Did the programme work? Have you made money? Are there any weaknesses in the programme? How much time do you spend every week working on the programme?

Step 7: Test the market for the product or service

Many first-time business opportunity buyers are disappointed when the product or service doesn’t sell. They purchase the advertising and mail the promotions, but nothing happens.

Always try to test the potential of a product or service before you plunk down your credit card. Ask friends and family: Would you buy it? How much would you pay? Run your own focus group, interview people at the local shopping mall – do anything you can to get feedback on the marketability of the product or service.

Step 8: Negotiate the purchase

Here’s a secret: Business opportunity sellers charge prices that vary widely and depend largely on what they think you’re willing to spend. So be a tough sell. Make an offer on your terms, structured to suit your interests. Spread payments over time, defer payments until after delivery of the goods or simply make a low-ball offer. You’ll be surprised when the seller doesn’t close the door on you but keeps right on talking.

Change Your Attitude

These eight steps will help you avoid the most common traps of buying a business opportunity programme, but there’s one last pitfall to be wary of: your attitude. Don’t expect to ever see the value of your investment if it just sits on your shelf gathering dust. Always maintain your enthusiasm, and follow through. It could make all the difference to your future success.

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Don’t Tread On Toes – Why Investing In A HIQ Franchise Will Offer You More Opportunities

Are you looking at investing in a tyre replacement and service industry? Look no further than the Hi-Q franchise.

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Vital Stats

Established in 1999, Hi-Q is a successful and diverse multi-product, multi-brand leader in the tyre replacement and service industry with a network of over 130 franchisees nationwide.

With the support of international tyre giant Goodyear, Hi-Q has established a solid reputation of ‘the one you can trust’, and the Hi-Q approach and philosophy is embedded in this.  We have the trust of our customers, our network and our suppliers – that’s why you can trust us to take you and your business to the next level.

When you’re working with people’s safety, trust forms the most significant part of the equation

Hi-Q introduced the original and innovative TyreSurance initiative – the only aftermarket tyre damage guarantee product that backs the consumer no matter the brand of tyre. Each Hi-Q Franchise offers a broad range of brands within the different product and service categories that customers know they can trust, and at prices they can afford. Product and services include tyres, exhausts, shocks, batteries or brakes, wheel alignment or balancing, and a 10-point safety check.

We have identified areas of opportunity to extend our Franchise footprint growth. If you are looking to join a new franchise and you share in our values and vision, we would like to hear from you.

For further information on how to become a franchisee, call us on +27 11 394 3150.

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Related: We Want To Invite You To Join Us On The Hi-Q Journey And Become A Franchisee

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Researching a Franchise

Be In The Property Business For Yourself, Not By Yourself

Why property franchising makes good business sense in today’s market.

Keith Broadfoote-Brown

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Opening a real estate franchise has been a thriving and successful business model in South Africa for decades. Despite the challenges currently facing the South African economy, property will continue to prosper and provide entrepreneurs with an opportunity to own their own successful businesses and become leading members of their local business communities.

“The residential property market is a dynamic, thriving industry offering substantial career opportunities.

Joining a property franchise business gives entrepreneurs the opportunity to align themselves with reputable, established businesses with a national footprint who have invested in their brands and have access to international networks,” says Russell Berkman, Franchise Director at Jawitz Properties.

While the property industry is competitive there is still great potential for growth. Worldwide, franchising has proven to be one of the most successful business models with failure rates well below those of starting a business from scratch.

Related: How to Become a Property Franchisee

For the franchisee, it is one of the most intelligent ways of starting and growing a business and by combining the proven business formula of the franchisor with the entrepreneurial drive of the owner-franchisee, the likelihood of a successful business venture for both parties is increased significantly.

According to Keith Broadfoote-Brown, the owner and Principal of the Jawitz Properties Ballito franchise in KwaZulu-Natal, property franchise still makes good business sense in today’s market.

The benefits of being a property franchise owner

Becoming a property franchisee gives a businessperson unlimited potential to succeed in the property industry as the success achieved is a direct result of the effort, commitment and drive put in. It means being self-employed within an organisational structure and offers the same structure and benefits to sales and rental consultants.

“It gives you the opportunity to leverage your business’ success off the intellectual capital, brand, expertise and know-how of an established business that has a proven business model, IT platforms, marketing expertise, training and self-development programmes as well as having access to years of experience in these fields.  My mantra is ‘be in business for yourself, not by yourself’,” says Brown.

Skills needed to succeed as a property franchisee

The most important competencies would be to have an entrepreneurial character and business skills such as financial literacy, HR/people skills and marketing acumen; a people’s person with a resilient and driven personality. Experience in real estate is always beneficial but not required as it is all about using business skills, marketing acumen and entrepreneurial tenacity to make your mark.

Related: How Brigid Prinsloo Made (A Lot Of) Money On Airbnb

Brown explains, “Absolute professionalism and integrity and a fierce determination to exceed your client’s service expectations are essential. And you must be able to develop a highly competent sales team, explore new opportunities for your business and operate as a team player within a franchise structure”.

Current state of the property market

The property market in SA currently reflects the economy and is weighted in favour of buyers, so sellers need to be very realistic with their price expectations. Buyers are buying where they perceive good value and value is indeed the key driver in the market today.

The opportunities are strong for buyers to invest in this ‘down’ market and conditions are also ideal to upgrade one’s home. In every region and in every suburb there are homes offering good value and these are selling well, despite the tougher trading conditions.

Opportunities outweigh the challenges

“The opportunity for real estate professionals is to find and secure the well-priced, good value, properties as they are selling!

It is also an opportune time to enter the market as a franchisee or new agent/intern as I am firmly of the view that great estate agents learn their profession well in a tough market and when the market improves, as it surely will, these sales professionals will have a solid grounding and strong foundation on which to build their real estate careers.

Challenges are to manage costs in these tough trading conditions. To keep motivated and continue to consistently drive the very basic activities needed to succeed in real estate,” says Brown.

Top 3 things to consider before entering the industry

According to Brown, his top 3 considerations are as follows:   

  1. You need sufficient start-up capital as the initial investment in starting the business and the monthly expenses to run the business can be substantial. The income from sales and rentals may be slow in the early years, hence the need for good planning and sufficient start-up funds.
  2. Owning one’s own business means the buck stops with you! A well thought out and well implemented business plan is key. The first 2-3 years consist of long hours and could potentially be financially strained, as in any start-up business, but the rewards of owning your franchise and being ‘master of your own destiny’ are worth it!
  3. This is a tough business for tough-minded people. Having an initial mindset of ‘it is harder than I think’ rather than ‘it will be smooth sailing’ is a better approach and will prepare the franchisee for the hiccups that will surely come along.

Property franchising makes good business sense

The end result of being a successful property franchisee is financial security. Owning a brand office assures the owner of having an asset and the credibility, back-up and brand promise assures clients they are in safe and professional hands.

“I would definitely recommend being part of a major brand rather than a being a small real estate entity, especially in this competitive industry. Property is a challenging industry that, like everything else, goes through cycles, influenced by factors like inflation and interest rates, among others.

Drive, initiative and resilience are therefore essential qualities for a successful property franchisee. Absolute professionalism and integrity and a fierce determination to exceed your client’s service expectations are essential,” Brown concludes.

Related: Want To Start A Property Business That Buys Property And Rents It Out?

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Researching a Franchise

Col’Cacchio – Benefits Of The Franchise Model

Six key benefits of the restaurant franchise model – and what to look out for when considering a franchise.

Russell Otty

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For investors looking to the restaurant industry and considering a franchise knowing it has a proven track record and is therefore possibly a lower risk, there are a few key things to be aware of about the benefits of the franchise model, which if investigated, can also point to a franchise that is not for you.

Russell Otty, Chief Operating Officer of the Col’Cacchio Group, shares some of these key benefits and indicators of whether a franchise is for you:

1. Making the cut as a franchisee gives you the confidence that you are making the right decision

You may think psychometric testing, three days in a restaurant following a franchisee around, and a panel interview with the senior management of the franchisor, is a bit over the top, but the franchisor that puts you through your paces and assesses your ability and commitment to running the business, is doing you a huge favour and may even help you see this is not for you. It goes both ways, and after an intense courtship, you should know if you want to try a long-term relationship.

Related: Col’ Cacchio: A Passion For Pizza

2. Assistance with location selection and negotiation of the terms of your lease

One thing you can do to limit your risk is to not open a restaurant in the first place if your rent is not going to be reasonable or you simply won’t get customers through the door. The franchisor will vet and approve the site – they will have extensive insight into what has worked or not worked location-wise for their brand, and can assist you to weigh up the area and it’s potential to attract customers.

The commercial terms of a lease is very important – you can’t be too ambitious about turnover targets, and having the backing of a franchisor can be beneficial if a landlord becomes unreasonable.

3. Staff training and development tools on hand

Consistency is important with restaurant franchises, as a customer visiting a brand anywhere in the country, goes there knowing exactly what they are going to get. This is best achieved with solid training, perhaps access to resources such as training videos, and regular visits from franchise managers.

You should check with your franchisor what level of training and franchise support you will have on an ongoing basis. Ask about the ratio of field trainers and operations managers to the number of franchisees in the group. You want the franchisor in your restaurant in some shape or form, two or three times a month, whether it be the training manager, the regional franchise manager or the national operations manager.

4. Access to supplier networks to manage your input costs

Negotiating basket pricing with distributors regionally and nationally, the franchisor will leverage their buying power on your behalf. They should assist to manage your suppliers and make sure deliveries happen on time, and ensure that product quality remains consistent. They can also negotiate to ensure your input costs do not increase before the next menu launch – so you can ensure your margins remain intact.

5. Brand loyalty and locality marketing

When you buy a restaurant franchise, you gain a group of customers who know who you are, the food you serve and the way you make them feel. The money you will pay towards marketing each month gives you insight into the broader restaurant market, the experience of what is working across a number of sites, and how best to keep the attention of new and existing customers.

Some franchisors offer locality marketing assistance – your site and area has specific needs that other outlets may not have, or there may be events in the area that can be leveraged to run special offers. Ask if the franchisor offers this as a service, as it can assist you greatly to have an advantage over other restaurants in your area.

Related: Beginners Guide To Digital Marketing In South Africa

6. Business development insights

The franchisor has access to insights gained across the group, and the systems that they have in place to track costs and increase profit margins, can be of huge assistance. If you are looking for business support, a franchise manager can be the one sitting with you telling you that you spent R2 000 too much on cleaning this month or saying you need to wait till next month to make that purchase. The level of business support you will have access to, is an important factor to consider, depending on the level of support you may require.

Recipe for success

Nine times out of ten, a restaurant franchise that fails, fails because the franchisee loses interest or lacks the commitment to make it work. Selecting the best franchise for you as the investor, or as a restaurant entrepreneur, is the most important first step you can take towards success, so do the homework.

Don’t assume that because you are buying into a successful brand that it will be a success – business is not an exact science – you need to do your own due diligence and take responsibility for your business, because it is after all your own investment.

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