When you hear the word \u201cfranchising\u201d, the first thing that pops into your head is probably that McDonald\u2019s or KFC sign that you drive past every day. It is however, very important to remember that this type of brand association is just the tip of the multi-dimensional, money-making iceberg.<\/p>\n
Absa spoke to Henk Botha, a Franchising Specialist for Quick Service Restaurants and Restaurants, and asked him to share some of the key tips that he has collected over the past 14 years.<\/p>\n
Botha says that if someone asked him to sum up the tricky concept of franchising into one sentence, it would be: \u201cIt\u2019s a proven concept providing great opportunities at low risk, but requiring dedication for success.\u201d<\/p>\n
What\u2019s the best time to become a franchisee?<\/strong><\/p>\n With the unpredictable and in some ways uncertain financial times we find ourselves in, the first thing you\u2019re probably questioning is the timing of this kind of investment.<\/p>\n According to Botha there will always be positives and negatives surrounding this decision.<\/p>\n \u201cIf you want to go into business, the franchise option is always the better one. Do your research and find out exactly what it is that you want to do \u2013 there are a lot of different franchising options out there.\u201d<\/p>\n Botha warns that if you\u2019re not someone who\u2019s disciplined enough to work within certain restrictions, becoming a franchisee is not the best option for you.\u00a0 \u201cTrue entrepreneurs find the rules and perimeters that go along with franchising very frustrating.\u201d<\/p>\n Here are a few other pros and cons:<\/p>\n Pros<\/strong><\/p>\n Cons<\/strong><\/p>\n Botha added to this by explaining that the financial climate within franchising is also ever-changing. \u201cAt the moment restaurants are doing very well, but we see these things change about every two years. If you\u2019re prepared to work hard and run the franchise as if it\u2019s your own business, any time is the right time for you to become a franchisee.\u201d<\/p>\n How do I choose which brand is right for me?<\/strong><\/p>\n According to Botha this decision ultimately comes down to where your passion lies. There are however a few other questions you can ask yourself to help narrow down the vast amount of options:<\/p>\n Once you\u2019ve looked at these aspects, you\u2019ll at least be able to narrow it down to a specific sector. The next step is to obtain the disclosure documents of a few franchises within that sector. It would be beneficial to talk to a few current franchisees about topics such as cash returns, what works, what doesn\u2019t work and how happy they are.<\/p>\n Like everything in life, there are good and bad outcomes to any situation. Though franchises are highly successful most of the time, Botha strongly advises a hands-on approach where staff and money is managed properly, as well as good client service.<\/p>\n Read the full article on the Absa blog, here<\/a><\/p>\n How much it costs to open a fast food franchise in South Africa<\/strong><\/a><\/p>\n\n
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