Before entering the Franchise Business, Think about exit also.

The life of a franchise business owner is exciting. Better a poor horse than no horse at all. Even if you have to struggle for some time in your life, the rest of your life as a self-reliant, independent business owner is enjoyable and dignified. The best start is as good as possible as a business or entrepreneur… but a good start or exit plan is a must to consider when making a good start as a franchise owner.

Are you surprised? …

When starting a new business, why should anyone think of a special plan to get out of it when you are strategizing for permanent success, business growth, and reputation as a successful entrepreneur? But the fact is, one way or another, the business may one day take a different turn. Unfortunately many small to large entrepreneurs do not have pre-planned strategies or policies to deal with that situation. If you have an exit plan for your business right from the start in the franchise world, then when bad time comes in your business, your mind will be ready for it and you will not have any more mental problems. In other words, there will be some difficulties in your business which may lead you to quit the business, in which case if you have the right exit plan, you will be able to get out of it successfully. ‘Sales’ is the most important factor in franchising. The fruit of your hard work in your business is sales and the profit that comes from it. A businessman spends most of his life not only to keep the business going but also to keep it growing and he is trying to grow the business as a salable asset to make more profit at the right time. Of course, the right time will be different for every business, but it will come one day.

When discussing the exit strategy of a franchise business, it is necessary to have a clear opinion on the following points.

1) How long do you want to work as a business owner?

Do you want to leave the corporate world after working long hours? Is Professional Life Your Retirement Plan? Or starting a new business or starting a new chapter in life?

Many small business owners want to retire with a lot of money. According to a survey, less than 30 per cent of entrepreneurs make a special effort to pass on their business to the next generation, with the rest leaving the business. You have to have an idea, when will you get out of business? This doesn’t mean you have to quit the business you are starting, but you still need to have an exit plan or a retirement plan. When you have a pre-planned exit plan, you get the right value for your business.

2) What will happen to the business, when it is ready to sell?

Are you really ready to sell your business? Is there anyone in your knowledge who is eager to buy your business?
Many franchisees think their business is a family business, which parents leave to their children after a while. If the children are young or teenagers, a good backup plan is definitely needed for them. In many business families, children are nurtured from an early age, so that the children will be active in the business. Still, parents should sit down with their children and review their business plans. That is, they know the right time to put the business in their hands.

3) Do you think franchising is a good business even in a recession?

Just because you are going to sell your business after a while does not mean that the financial situation in the country will be right for that business at that time. Maybe even an economic downturn. But even if you have some concrete plans for a possible recession, selling a business in the future will not have much effect. But it is not possible to predict the future of the economy. However, if you have already made plans to sell your business, your business can get a fair price even in times of recession.

4) Does franchising have the feature of frequent profit making and gaining membership?

When it comes time to sell a franchise, things like long-term contracts, membership or membership fees look attractive, because these things indicate the certainty of income and viability of the business.
The ability to predict frequent profits also boosts the confidence of prospective buyers. When they buy your business, they are sure to succeed. How to plan your expenses? How to create business growth plans? What will be your exit plan? They are better aware of this.

5) Is your franchise business salable?

This is an important question that every franchisor should ask himself. How long can a franchisee normally run their business? What are their main reasons for deciding to buy a franchise? How long can they run a business and how much profit can they make? It is important to know this.
Established franchise brands need to have a lot of data available on the sales capacity of their unit and be able to offer it to franchisees.

6) Does the franchisor help you sell your franchise unit?

The main reason why people buy franchises is because franchising is a business model that guarantees success and in many cases the support system from the franchisor.

With that in mind, will the franchisor help you sell or exit your business? Does he have any such procedures? It would be appropriate to ask the franchisor. Does the corporate office participate in the sales of the franchise unit? Will your business get marketing support from a franchisor for sale? Does the franchisor have a database of businesses looking to buy your franchise? This should also be asked.

There are many benefits to being a franchise owner. But after leaving that business, life should be just as rewarding. That’s why exit strategies should be considered when starting a franchise business. So that it will be easier to get out of business at the right time.

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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