• Skip to main content
  • Skip to header right navigation
  • Skip to site footer
franchising consultants nz

Franchize Consultants will help you franchise a business

Contact us for a free no obligation meeting to discuss how to franchise a business or improve your existing franchise. Call 09-523 3858 our book online.

  • About Us
    • Our Team
    • Why Franchize Consultants?
    • Mission and Values
  • Franchising a Business
    • How to Franchise your Business
    • The Franchise Advantage
    • Franchising Suitability
    • Franchising and Licensing Seminar
  • Franchisor Services
    • Franchise Review
    • Franchise Support Programme
    • Satisfaction Surveys & Research
    • Franchise Manuals
    • Franchise Management Training
    • Franchise Advisory Councils
    • Field Visit Support
    • International Franchising
  • Training
    • Franchise Field Visit Foundations
    • Improving Franchisee Performance
    • Franchisee Business Planning
    • Managing a Franchise System
  • Resources
    • News and Resources
    • How to Franchise Guide
    • Best Practice Book
    • Best Practice 500 Series
  • Contact
    • Free Assessment Meeting

Potential Franchisee Focus on Profits and Returns.

July 31, 2019 by Callum Floyd

\"Franchisee

This best practice is for potential franchisees. If you are considering purchasing a franchise, then we suggest you place great focus on the potential returns of any franchise you consider.

It is important that you don’t get carried away thinking about the type of work of the franchise, without giving adequate attention to what the business will need in financial terms upfront – and what it could or should look like as it grows and develops. This is to help you understand the full range of potential and likely outcomes, and therefore attractiveness to you. By following this process you may also find some of the best returns available to be associated with franchises in industries you weren’t initially aware of and/or attracted to.

So it is important for any franchise that you consider that you have a really extensive understanding of the total investment that you will need to make (initially and ongoing), including the extent of working capital that might be needed in order to reach break-even. Aligned, you will want to think about what your profit and cash flow position could and should look like as the business grows and develops overtime.

To achieve this great focus, you will need to conduct good research and due diligence. You will need to collect relevant financial information and planning tools from the franchisor. You will want to work with a specialist accountant. You will want to corroborate certain information with franchisees you may interact with as part of your research. And you will want to talk with your bank; they may already bank company and/or other franchisee units.

In behind this primary focus, and we call this a primary focus because you need to stay in business, is a need to explore and understand what you will need to be able to do to get this business to perform at the level necessary to achieve your profit and return objectives.

We talk of this profit and return focus because it is so important that you understand this aspect of the business and also hone a very clear objective for what you want to achieve. That then allows you to translate that into clear plans (often with the franchisors help) for what you need to do to achieve those objectives. It enables a more productive franchisor-franchisee relationship that has a positive outcome focus.

And if you have this profit and return focus, prior to even signing a franchise agreement, you can ask your potential franchisor how they have worked with franchisees on their profit and return objectives, and you can also ask established franchisees the same.

In summary, you need to have a profit and return focus prior to purchasing a franchise, and you need a franchisor that also has this focus at a franchisee level as well. Aligned you will note that a franchisor [Leadership Focus on Franchisee Profit and Returns] is our very first best practice we have identified within our total [Franchising Best Practice 500].

About the Franchising Best Practice 500 Series

\"Franchise

This is part of a series of franchising best practices. Franchize Consultants is sharing and publishing these best practices weekly for the betterment of franchising. We know that better knowledge and execution of franchising best practices leads to bigger and more valuable franchisor and franchisee businesses.

We have assembled the first 40 best practices into The Best Practice Handbook, which is available for purchase.

\"\"

You can make contact with us on +64 (0) 9 523 3858 or via the contact form below for any further information. You can also connect with us on Facebook, LinkedIn and Google.

Oops! We could not locate your form.

Category: Blog, Franchise Best Practice

About Callum Floyd

Our Managing Director, Dr Callum Floyd, served on the FANZ board in various roles for nearly a decade, and Franchize Consultants continues its long-term support of FANZ in any way it can. We’re strong believers in the value of FANZ’s firm codes of practice and ethics, and for this reason recommend our franchisor businesses consider FANZ membership.

Previous Post: « Structured Field Visit Agenda
Next Post: Franchise Governance Meeting Regularity. »

Get in Touch

Call 09 523 3858

Email enquiry

Office Address

Franchize Consultants (NZ)
Suite 4, Level 1, 27 Gillies Avenue, Newmarket, Auckland, New Zealand.

Franchising a Business

The Franchise Advantage

How to Franchise Your Business

Download Free Franchise Guide

Franchise Best Practice Book

Franchisor Services

Franchise System Review

Franchise Manuals

Satisfaction Surveys and Research

Franchise Training

Connect with us

  • Facebook
  • Google
  • LinkedIn
  • Instagram

Email Newsletter

Sign up to get free resources, tips, and franchising news.

“Franchize Consultants have been proudly serving New Zealand for 30 years.”

    Six times winner of Westpac New Zealand Franchise Awards.

    Founding member since inception of the Franchise Association of New Zealand.

    Copyright © 2022 · Franchize Consultants (NZ) · All Rights Reserved