Checklist Before Buying a Franchise in India – Franchise Buying Guide for 2024
Buying a franchise in a hugely populated and opportunistic country like India is not a cup of tea. It is a very big responsibility and for which necessary steps must be taken before even planning to open one. There are certain steps or guidelines that one must follow before they open and choose a franchise.
If you are a first-timer then you are bound to face numerous problems in the beginning as there are plenty of Disadvantages as well for franchise business in India. To avoid that, all the necessary steps must be taken by franchisee-seekers. Here in this article, we will talk about things you should do to buy a franchise in India.
Gather Complete Information
Gathering information or proper market research about your franchise interest is very crucial. It is surely the first step that one must take before one plans to buy a franchise in their locality. Now, there are numerous ways of gathering information regarding the franchise you are willing to open.
The best and the cheapest method is online surfing. You can always use the internet to study everything about the franchise you are willing to open.
Interested people can avail themselves the publicly available information about the franchise they are willing to buy.
Doing this will help you to know if the chosen business is right for you and your area or not.
You could even conduct a personal market survey regarding the products and services your franchise would be serving.
It would give you clear data or information on how well your franchise business would run in the area you are willing to open. In the end, you must gather all possible information regarding the company and its franchise so that you do not face any problems later.
Must Read : Pros & Cons of a Franchise Business In India
Franchise Cost Investigation
The Total cost of opening a franchise is another significant factor that one must consider. Before you get into any franchise business, you must properly understand their financial capabilities.
You should know if you can run the business properly or not in the future.
Now, that is one of the reasons why businesses rolling out their franchise option go through a financial check of the franchisees.
You need to determine the total investment or cost required to set up your franchise and get it running.
Once your franchise is running that does not mean it will not require any additional cost.
In some types of franchise businesses, franchise owners need to make continuous expenses to keep the franchise running in the market.
A documented quotation of investment
It is very important to make or create a documented quotation of investment of the franchise business. Franchisee-seekers must get a fixed cost written in a document from the business in exchange for the goods and services that they are going to provide.
In this document, every investment amount must be written so that franchise owners can understand how much they need to invest. It could even declare after how long you would be getting your return on investment.
Visit at least 2-3 outlets of the franchise and check the overall customer experience
Visiting a similar franchise or other same outlets in our area would give you a practical knowledge of how everything runs. Getting insights from two or three different outlets of a franchise would give you proper knowledge of the types of visiting customers and their choices.
It is very important to know the customers’ tastes and preferences. As a businessman, you must know how to attract customers and the latest trends in the market. It will also give you experience on how to deal with different customers, solve their problems, and other ways to satisfy them.
For this, you need to have great observation power. You need to understand the demand of customers and how they behave to it. Once you get to know the behaviour patterns of customers, you will be able to run your franchise business quite smoothly and will be able to handle customers very easily.
Franchise feedback through owners as well as staff of a franchise outlet
If you are willing to get ground results then getting a feedback though same franchise owners and their staff are very important. You need to ask them questions regarding the daily operation of the franchise and how they handle problems in difficult situations.
The answer you will get from the other side will come from lots of experience. You could either listen to them very carefully or write them down so that you do not forget them. It is because those are real insights which will be very helpful once you also open the same franchise in your area.
Once you are done with the manager of the franchise, do not forget the staff members as well. These people also play a key role in the overall growth of a franchise.
Company should be in the franchise business for at least 2 years
I am sure you will choose a company which has properly been established in the market. Make sure you choose a company’s franchise which has a good brand reputation and goodwill in the market. Now, brand reputation and goodwill do not happen in a short span, they take time.
This is the reason why, the company franchise you choose must be in business for at least 2 years or more. The more they are in the franchise business the better it becomes. Now, the best way to check how old is a company is by visiting the Ministry of Company Affairs website.
After you put all the information regarding your franchise company, that website will give every detail about it.
Check negative reviews across platforms
Checking the negative review first for a business franchise is very important. It gives you the gaps to work on. It is the best way to satisfy your customers and not get any complaints from them.
Now, there are numerous methods of how you can check negative reviews for the franchise company. Here are some of the platforms where you could check what customers are talking about the company franchise:-
- YouTube
- Google Reviews
Thoroughly understand the skill prerequisites and your compatibility with the business
Running a business franchise requires different skills and knowledge. Make sure that you gain the necessary skills for the business franchise you choose. It is how you will understand the needs and wants of customers from your business franchise.
Skills are something that cannot be inherited forcefully. You need to understand and become compatible with it so that it comes out naturally when needed.
Check for ROI of other competitors in the segment
Reviewing how your competitors are doing is very important for a franchise business. It is because you always want to do better than your competitors in the market. Before you choose a franchise business make sure to check the return on investment of its competitors.
Doing this will give you insights into which one might be the perfect one for you. Moreover, you only want to join hands with the best in the market.