Don’t Buy A Dealership Just By Looking At A Big Brand, Look At The People Behind The Brand.

” The caravan does not stop just by giving a voice! It is also important who gave the voice !!”

Buying a dealership is a fantastic way for entrepreneurs, especially for beginners; They think this is the easiest way to make a profit. But it is said, “The devil is in the details.” This means that something may seem simple at first glance, but it takes more time and effort than expected. So dealership opportunities have a lot more than just initial investment and assured success. Don’t buy a dealership of any company just by looking at big ads, brands, big offices, and corporate culture, but look at who the people behind those dealerships are. To improve your chances of success, you need to take the time to evaluate the brand company and the industry in which they operate.

The following are some of the things you should consider when evaluating a dealership opportunity.

The company’s vision

Business Vision is a short, concise, and inspiring statement that sets out what the company wants to achieve in the future and what it wants to achieve competitively. It gives you a clear idea of what you are committed to and what your ultimate goal should be.

E.g. Ford Motor Company’s vision is to become the largest consumer company in the field of automotive products and services.

Competitive dominance

Competitive Advantage is a separator (or wall) that makes a dealership company more dominant in the market than its competitors and keeps the company more profitable through its excellent products, patents, brand power, technology, or operating efficiency. So when taking a dealership, choose a brand that can provide good service and help you grow your business and brand name.

E.g. Walmart offers the lowest prices of products, so Walmart is more successful than its competitors.

Leadership

You don’t have to look at the brand’s entire life character when taking a dealership, it’s just important to know a brief history of their business background. If a brand has a strong background and qualifications in that industry, it is more likely to succeed. Most of the time success is highly dependent on the leadership of the dealership company.

Source of investment

It is important to know the sources of investment for the expansion of the dealership business. If the dealership raises money properly it is fine but if they raise money from the wrong person or way it can be dangerous for the dealership business.

E.g. Nowadays it is understood that a well-known political leader has used black money to squander by giving the dealership of an eye care hospital owned by anonymous companies.

Experience

  “Experience is the greatest guru.” Many brands/companies have many years of experience selling products or services and managing dealership systems. Some brands/companies started their businesses and started giving dealerships to others. However, it is not certain that a successful entrepreneur can successfully manage a dealership system. Find out how long the brand has managed the dealership system. Does the brand itself have enough skills to give you convenient business processes and brand support?

Generating capacity

 It is difficult to find the income capacity of a dealership You cannot compare the production capacity of dealerships of other locations. Get a detailed list of financial statistics from other dealers, examine how successful dealers turned out to be profitable, and find out if other dealerships have recently failed.

Economic situation

It is said, “Stay On Top Of Your Finances, Don’t Leave That Up To Others.”

The most recent financial statements of brands/companies show you the financial picture of the dealership system. You also need to find out if the bulk of their revenue comes from dealers’ total sales and whether the brand reserves sufficient funds for the system.

Take a look at proven business models

When you buy dealerships of brands/companies you buy proven business models. There needs to be a system for everything from payroll and marketing to client services and up-sales. But if the dealership opportunity doesn’t come with a functional system, suppose you’re running an arrow in the dark.

Support capacity

See if the brand/company whose dealership is offering offers a thoughtful, structured, and proven support system. Great brands/companies believe that the success of a successful and great brand depends on the skills of each of their dealers. Assist successful brands/companies in developing their dealerships.

Stability

How long has a brand/company been in business before starting a dealership and how profitable was it? Do consumers know their products? What is the background of the directors of that company? Does the company have a solid, steady growth history? The risk is higher if it is a new company without a good track record.

Risk factors

Identify potential factors that may affect a company’s performance and future growth. E.g. Is the company bringing a brand new product/service? If so, who are its competitors and how successful are they? If other competitors are more established, it may take longer for this company to stabilize in the market.

Management team

How smart and expert the management team is more important than how great an idea or project is. The expert management team are the key factors behind the success of a successful company and the expert management team in the company gives a lot of pleasant and successful experience. Review how long each person had at the franchisor and other details about the chief franchisor executive.

Growth opportunities

The potential market size is variable which may indicate a growth opportunity. Why has a company been successful in the past? Gorilla marketing, online reputation management, social media engagement need to be considered. The whole game depends on the speed of the company’s success and how well the company has a grip on it.

Scalability

Is this business scalable? Do you have the right system? You may have had to deal with such issues. It is important to consider all of these for your dealership to continue to operate successfully on new systems, new management, and new locations.

Quality management

Many of our customers are manufacturing companies. When taking a dealership of a new company, it is seen that there is a fall if there is no proper quality management system. You need a system that guarantees quality products or services from the respective brand/company – otherwise, your dealership business will be tarnished.

Ethical People

The world’s top companies that provide factual information respect everyone and abide by the rules and regulations. They are famous for high moral standards. Ethical behavior is a direct representation of principles and values, which independently controls every individual and organization working in the system.

As franchise consultants in Mumbai, we at Franchise Birbal always provide individual attention to our clients and help them to establish franchise businesses both in India and internationally. Franchise Birbal helps franchisees start, grow, and protect their franchises. By developing a franchise business with us you get the assurance that you will be able to establish your franchise business successfully. Our franchise consulting and legal documentation services start from Rs. 15000/-* onwards.

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