Success - How it looks in your first year of franchising

When opening up a franchise and making the leap into the owning your own business world, it is important to know how to judge your first year as a success. In this article, we paint that picture so that you do not panic if things are not turning out the way you thought.

Acquired the funds necessary to purchase a franchise? Check. Sealed the deal and became a franchisee? Check. Before you even launch and begin operating, you are off to an impressive start. So, when you reflect on your first year of trading, how do you measure the term ‘success’?

When starting your own business, doing it alone serves a greater risk than if you were to open a franchise. In the UK, there are over 50,000 franchise units, with 6 out of 10 turning over more than £250,000. This is why franchising is so appealing for those seeking the ‘be your own boss’ intention.

In any circumstance, the first 12 months of anything is always the hardest. From exercising to get those washboard abs to learning a language, everything takes time. It is no different when running a business. The initial year, even when running a franchise doesn’t guarantee success, however it gives you a fighting chance.

A business plan

In order to determine what a success of failure was then you need to have a clear business plan. This important tool allows you to clearly track your progress on whether you are achieving or failing your targets. Not only does it give you a better understanding of how your business is operating and at what level you are, but it also allows potential investors to see if you are worth investing in. In order to gain funding, you will need a business plan to show specified franchise banks. A business plan allows you to stick to a path that you do not want to deviate away from. 

Life changing… one step at a time

When you purchase a franchise, you have a clear ambition of being the boss. This can be a bit of a shock when it comes to people who have always previously been employed. Now you are the boss, you must start thinking and acting like one. Making decisions, adapting to your environment and driving yourself on to push for success is all the basic ingredients. You must be prepared to shake up your work/life balance and dedicate potentially long and unusual hours (yes, even the weekends are not safe). Throughout the year however you will soon realise what it takes and how to achieve this symmetry in lifestyle so that it makes it all seem worth it.

Know what you are getting in to

As mandatory, before you even purchase a franchise you would have done your background checks. Conversing with existing franchisees on how their first year goes and what to expect would give you a clear indication on what you can be faced with. Talking with the franchisor in terms of their goals and aspirations also gives you a better insight as to what challenges and difficulties you can come up against. Knowing these key details can help put your mind at ease. Do not forget, Rome was not built in a day.

Haven’t I seen you before?

It goes without saying that advertising and marketing are the fundamentals when getting your business off the ground. The franchisor will help build marketing strategies with you and give you all the necessary tools and resources to help crack the market. However, it is important to know what works within your territory. If you are attempting to become a real market competitor, then what do your competitors do that get them customers. What are their USPs (Unique Selling Points)? Knowing your competitors tactics allow you to mould and manipulate yours so that you are exploiting their potential weaknesses as your strengths. Be sure to make a great first impression in order to really build a solid reputation.

Knowledge is power

Becoming a franchisee allows you into an exclusive circle of fellow business owners. When looking for ideas and information, they should be one of the first people you turn to for advice. Not only have they been in your position before but will also benefit from seeing a fellow franchisee succeed. Whether it’s marketing or general day to day running, be sure to keep in contact via Zoom, phone calls, emails or where possible meeting up.

The bottom line

Keeping track of spending is always essential but even more so in the first year. Monitoring finances is one of the major downfalls that new business owners cause themselves. Being able to see what money is coming in and out of the business at all times needs to be a top priority. If you find that you are spending more than what you are earning early on, then you can rectify it sooner and hopefully begin balancing the books again. This not only helps your chance of surviving the first year of operation but also gives you a chance of breaking even or better. Staying on top of the numbers with an Excel spreadsheet or a ledger helps you see clearly what the true figures are.

Expansion

Although this article has mainly focused on how to avoid disappointment from potentially not having the first year you hoped for, you may in fact go above and beyond your expectations. If your business takes off and you are succeeding more than initially had imagined, this may have sped up the process of expansion. Is there a possibility that you could bring on a new van to your business or in fact open a centre of operations? Or look to gain an additional franchise unit within your territory? These are serious questions that you can now consider if you surpass your targets and look to take your business to the next level.

Remember, opening a business is meant to be a positive step in the right direction for you to change your life for the better. Maintaining a can-do attitude and ensuring you celebrate even the tiniest of successes will make you feel like it has all been worth it. Set milestones that you can achieve and targets that are more challenging to keep you on your toes. Getting the equilibrium of the work/life balance and earning an increased personal income will just be the icing on the cake.