Modern Franchise Magazine August 2013 - Page 35

better than as an employee. In some cases, this may mean that franchisees find themselves working long, unsociable hours struggling to earn a good income. Buying a busy food, convenience or retail franchise that requires 7 day operations or even 24/7, might be OK if you don’t have family commitments, but as your circumstances change you could easily find yourself stuck in a 5 or 10 year agreement that is A franchisor's royalty structure may mean that their hard to break or on-sell, working unsociable hours business objectives and a franchisee's ideal while trying cope with a young family. work/life balance are not compatible. Another example is if a mumpreneur was to enter Where royalties are payable as a percentage of into an agreement for a small local work-fromturnover, it is in the franchisor's interests for home franchise, which provides a small income, franchisees to achieve ever higher turnover. but allows for flexible working conditions. Just like as an employee, franchisees will have KPI’s set by the franchisor that they must meet. This situation can impact on the franchisee's work/life balance, because they are under pressure from the franchisor. This franchise is ideal when her children are young, but it could be "outgrown" in the future, when she is looking for a more satisfying challenge or if she wants the children attend a private school or when they attend university, and need significant financial support. In this situation, the market available to the Franchisees need to investigate if their financial franchisee is unlikely to be sufficient to meet her aspirations can be reasonably achieved if they are changing work/life and financial aspirations. working anything less than full-time. There also may not be a strong local market for her A franchisor may have ambitious brand franchise when it comes time to sell, or if the development targets, (perhaps in response to franchise term expires, there may also be no increasing competition), which could mean that guarantee of renewal. franchisees are under pressure to work longer hours to hit targets. So before signing on the dotted line, consider the following: The franchisor management team may be ? The motivations of the franchisor accountable to shareholders or investors, who will take a keen interest in business performance, ? The royalty structure, upon which royalties regardless of franchisees' work/life balance. are payable Many franchise contracts will specify mandatory trading hours. Before buying a franchise, take time to understand if the peak trading periods are compatible with your lifestyle. Do you have the support of your family if there is a requirement to work unsociable hours? Take into account your current circumstances, and how these and your work/life balance may change in the future. ? The ambitions of the franchisor, and the role of franchisees in brand development ? Compatibility of the franchise with your family, lifestyle and aspirations ? Your own work/life balance requirements, and how these could change in the future. maxiom Modern Franchise Magazine | 35