Did you know my number one mistake in franchising, costing me 2 franchise units? That’s right – I jump into franchising because of the potential alone, not because I am passionate about the niche of the franchise. I end up losing both.
Indeed, I do my analysis and all – I like the concept and am aware of the potential growth (and, of course, profitability) of the franchise. However, those are what shown on paper; I learn that, just like starting your own business, buying a franchise without having a strong passion on what you do, you will have a good chance of failure.
How important is passion in franchising? Jeff Elgin put up a great article on Entrepreneur.com talking about the role of passion in franchising
So, passion is all I need in franchising, right?
I’m not saying that you WILL fail if you buy a franchise based on its prospect as an investment; not at all! In fact, you should not let your passion clouds your risk/reward analysis. However, when you are experiencing tough times, your passion can help you navigate through the storm. In my opinion, you need strong drive and passion on what your franchise unit is selling; at least, you have someone who is passionate about the products and services your franchise unit sells.
Okay, perhaps passion has got nothing to do with profit. But you should be aware that as a business owner, you manage people. And when you manage people you influence them to do something for you and your business. Without passion, how can you inspire your managers and staffs?
In franchising, you should have both passion and risk/reward analysis
It seems that the best route for you in choosing the right franchise for you is looking for a franchise in the niche you passionate about AND take one that offer the best potential for profits. It’s that simple.
Of course, choosing which franchise that fits your passion is not an easy task. To help you out, here’s a flowchart for you:
Once you know what kind of franchise you are looking for, start to shop around – visit franchising expos, talk with experts, etc. But DON’T sign anything – ever – on emotion; listen to pitches as much as you like, but never, ever make a commitment on the spot!
FTC’s Bureau of Consumer Protection Business Center offers a useful consumer guide on buying a franchise – you should review it as the guide can tell you what you need to do in buying the right franchise – even helping you to decide whether franchising is for you or not.
Takeaway
Passion is not the ultimate detrimental effect when we talk about a franchise unit’s profitability. In fact, just like what I mentioned above, passion often has got nothing to do with profitability; you can have strong passion but your franchise unit can still struggle. However, as I mentioned above, passion can help you navigate through the highs and lows of your franchise business.
Perhaps you are not passionate about the niche, but rather you are passionate about the prospects; no worries! If you are a kind of investor with invest-and-forget mindset, perhaps you should find a franchise allowing you to be an absentee or passive franchise owner. Staying away from day-to-day operations is probably what’s best for you and your investment. Better yet, you might want to partner with someone who is a franchise material for her to manage the franchise unit for you.
If you are still not sure, the best route for you to take is to talk with reputable franchise consultant (not franchise sales consultant!) He/she can help you identify the right franchise based on your personality, passion and financials.
