HOW TO SPOT IF A TREND IS FOR YOU

Ask these top 20 questions to work out if investing in a business that’s trending is going to meet your purposes:

1. Who are the customers and how likely are they to buy from this brand? 2. Would you be a repeat customer at this business?

3. What makes this business different from the competition?

4. Is it a niche business or is there potential to broaden the product or services range?

5. How competitive is the consumer pricing?

6. Will the suppliers in the supply chain be able to furnish ongoing demand? 7. How quickly will the branding and offer tire?

8. How much investment is the franchisor spending on research of the market?

9. Whether the business is mobile or operates from a fixed site, is it easy to get the right location?

10. Do the sites currently operating get the foot traffic required to be successful?

11. Is the franchisor capable of supporting a fast-growing franchise?

12. Conversely, how can you make money from this business if there is a slowdown in the market?

13. What is the key to profitability in the business?

14. Do you have the skills to operate the business?

15. What training is available – business and technical?

16. How is the marketing tracked and measured?

17. How much local area marketing are you expected to do?

18. Is there a minimum revenue expectation from the franchisor?

19. What capital expenditure will the franchise require over the term of the agreement?

20. Is this a brand, and sector, you will be proud to represent?

It’s definitely worth doing your own research on both the particular sector you are considering and any brands you shortlist.

Brand-new franchises can be riskier investments but offer a chance to join an exciting, young business which may reap good returns. An established brand can sit well in a changing environment if it has the will and capacity to maintain its core base while innovating in essential areas to stay ahead of the competition.

The franchisor will provide plenty of information that’s helpful in your decisionmaking process, but back it up with independent due diligence and third-party advice from a franchise-experienced lawyer and accountant to get a full picture.