Published in El Economista , 27 - October , 2023 Overview franchises

A franchise is a business model where a franchising company grants the marketing rights of its brand and products to small investors called franchisees.

This business model allows the franchisor to deliver the marketing rights of its brand and products to buyers who acquire the title or company name of the same, according to the educational center portal "OBS Business School".

Many businesses of this type are successful and profitable, but many of the interested people do not know how to start the process of purchasing a franchise, since it is not only about choosing the most recognized one or the one that is within their investment scope, but a more complex decision.

It is for this reason, and the desire to achieve a successful business, that mistakes are made when choosing a franchise. To be successful and avoid some of the most common mistakes, here are some tips on what to keep in mind when opening a franchise.

Skip the training phase
A franchise system is complex to create. It requires starting from a successful business model. Then, it is essential to move on to a design stage where the franchise model is formally structured. This requires the support of experts.

In that sense, training on how to run that specific type of business is essential, since the omission of learning and structures on it can affect your exemption in the long term, according to the consulting firm "Franquicias Ecuador."

Price is not always a good sign
Although the economic aspect should influence the decision, do not rush to think about this factor alone. Choosing the wrong franchise can lead to business failure. It is best to accumulate enough investment to acquire a brand tailored to your needs.

Evaluate in detail the economic and financial behavior of the consortium you wish to acquire and start from a strategic clarity of where you want to take your business, which is supported by analysis of financial and market models.

Market the franchise as a product sale
According to Jonathan Sibaja, managing partner of the business "Strategic Expansion Network", although it is true that franchises are based on a commercial pattern, this does not mean that their sale should be handled as if it were a product of the business model. .

"It is necessary to create a franchise marketing strategy that clearly identifies the profile of partners being sought. All this associated with the business expansion goals," says the expert in his LinkedIn account.

Therefore, a process of converting interested parties into franchisees is required, as well as the appropriate tools to strategically and boldly carry out franchising so that they have the expected results.