Let’s say that you’re well on your way to becoming a successful entrepreneur by this point. You have made the decision to go into franchising because you like the idea of being your own boss, contributing to your own bottom line and experiencing a limitless future. You’ve done your due diligence and selected a carefully crafted opportunity that matches up with your needs. You have a business plan and it’s been blessed by a financial advisor and an attorney. The stars are aligned for your success and it comes down to a question of where your business will be located.
Two things are going to happen based on this decision. Either your business will succeed because you chose to reside in a prime location, with maximum visibility and well-heeled co-tenants or…your business could fail because you located your company in the wrong area. That’s why FranNet has such strong views on the supreme importance of your franchise location.
Taken at face value, many franchisors will have a good idea of the territory they want new franchisees to choose based on the location of other franchisees of the same brand. Typically, there are clauses written into franchise contracts which prohibits direct competition among these like-minded opportunities—and that’s a good thing. Territories are important because they allow you to operate exclusively in a stated set of boundaries. And if your franchise locating your franchise outlet in your community, you should have more than a passing knowledge of your own city or township’s neighborhoods and shopping districts.
That being said, here are three critical points to consider when selecting a location for your franchise:
- Look for Class A Retail Space. These spaces typically include a high concentration of population and higher household income levels. Ask for it by name!
- Population figures. Any real estate expert should be able to cite you statistics on daytime population within a three and/or five-mile radius of your location. It’s usually one of their prime selling points. If this isn’t discussed, it’s probably not a positive statistic!
- Co-tenancy. This is important! If the location is a shopping mall or retail strip, ask who the “Anchor” tenant is. Usually, it’s a well known grocer or national consumer branded store. Make sure all of the other businesses in the location don’t directly compete with your business or service. Also, consider whether or not you’d feel comfortable doing business around the businesses already located there.
Last, before you sign anything related to real estate, get out and investigate the opportunity on your own. Show up on a weekend afternoon and survey the car and foot traffic in and out of the location area. Check to see if public transportation supports your location. Then go on a Tuesday night. Make notes and compare. Talk to some of the other shop owners and proprietors. Many of them will be all too happy to share their experiences with you—both good and bad.
At the end of the day, FranNet wants our new franchisees to succeed well after signing a contract to represent a franchise brand. Blowing the whole opportunity with a bad location selection would be nothing less than a tragedy. Don’t let it happen to you.
Do you feel that you’re ready to get started? If this article has inspired you to investigate a franchise opportunity, perhaps it’s time for a free consultation with a qualified and experienced franchise consultant. As it turns out, FranNet is just the place! As a franchise consultant company with a great track record of assisting individuals on their path to business ownership, make arrangements to speak with me today.