Investing into a franchising brand is a great alternative to traditional business ownership for those who want to be their own boss, as you’re able to buy into a proven system while still being in charge of your location.
Rather than coming up with a business idea and strategy from scratch, you’re tapping into a model that has already been established. Similar to starting your own business, you’re able to run this operation as you see fit within the framework of this established brand without having to struggle through building brand recognition or coming up with fresh ideas to market your business.
Like any business venture, though, it’s important to do extensive research and due diligence to know where your investment will take you. The TWO MEN AND A TRUCK brand strives to be as transparent and honest as possible with potential franchisees so they have a strong understanding of what the business will look like for them one year in, five years in, and beyond.
Whether you’re thinking of franchising with us or with another brand, you should learn as much as you can about the brand and their operational methods, also in addition to thoroughly reviewing the brand’s franchise agreement prior to signing.
When reviewing a franchising agreement, below are a few crucial questions you should consider before moving forward.
1. How long does the agreement last, and what are the terms of renewal?
Franchise agreements generally fall within the range of five to 20 years. Make sure to verify with your franchisor that the agreement spans long enough to cover your initial investment.
2. Is the agreement one-sided?
You’ll find that some franchise agreements contain provisions which can seem to favor the franchisor, such as the ability of the franchisor to make enforceable changes at any time. As someone investing in the franchise, the brand is your most valuable asset, and you don’t want all your hard work washed away by the actions or inactions of a fellow franchisee. Franchise agreements must be strong to protect your investment.
3. What fees will I be charged?
This is a crucial question to ask right out of the gate, as it’s important to know what you’re getting. In franchising, some of the common fees you will see include the initial franchise fee, a transfer fee, a renewal fee, advertising fees, royalties, technology fees, and training fees. In some instances, a franchise may be required to use certain vendors with their own expenses. Make sure to review all of these details when making your financial projections.
4. Do I have the exclusive rights to the location I’m purchasing?
Make sure you know what your investment is getting you – there are a variety of ways that a company can divide franchise territories, and territories aren’t always exclusive.
5. Is the franchise agreement negotiable?
If you research and find out that your agreement is negotiable, it should raise concerns. It is important to make sure your franchise agreement is uniform because this ensures that you and your fellow franchisees are operating under the same terms. This also guarantees the brand you invest in will retain its quality and value.
Interested in franchising with TWO MEN AND A TRUCK? Click here to learn more!
TWO MEN AND A TRUCK® is the first and largest franchised moving company in the United States. Let us help move you forward! For more helpful tips and information on moving services subscribe to our blog and like us on Facebook.