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The five most common mistakes when starting a franchise

Posted on 04/09/2019

If you are thinking of investing in a business and believe that having a franchise in Colombia is the best alternative, we invite you to know what are the most common mistakes so you can avoid them and succeed.

1. Not identify with the brand

There are different types of franchises for sale, so it is important that you choose a brand that you like. In addition, it conducts an investigation on the company to know in depth its operation and find out with other franchisees about the experience they have had with the company.

In general, as an entrepreneur you will have to dedicate a lot of time to the franchise, so you should feel comfortable with the business model that you choose, otherwise working there will not generate satisfaction.

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2. Have an incomplete budget

Although franchises have a definite price, it is important to keep in mind that this cost does not include operating expenses. That is, fixed and variable business expenses, payroll, payment to suppliers, taxes, even your own salary.

Therefore, we advise you to have enough capital that allows you to make the investment and be able to sustain the business until you reach an equilibrium point that makes it self-sustaining.

Read also: How to know if a business is profitable

3. Not having business skills

While it is true that you do not need to be a business expert to start a franchise, it is recommended that you have some knowledge about marketing, business management, leadership, among others.

You can take a course or read on your own on these topics, so you will avoid making mistakes due to lack of knowledge.

Get advice from an expert here

4. Dismiss the franchise procedures

Keep in mind that when acquiring a franchise you must follow the rules and procedures that we have established the franchisee, if not you put the identity of the brand at risk.

Then, before signing, read the contract and the commitments you are accepting by investing in the franchise.

You may be interested: What should you know and do before buying a business?

5. Choosed a bad location

Finally, a key to the success of your investment is the place where the franchise is located. You should keep in mind that by saving money you can choose an unfavorable place for the growth of the brand. While being away from commercial areas may be more economical, profits may also be lower.

 

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