The Research Behind the Best Franchise to Own
When researching franchises, many entrepreneurs like to start with a specific sector or industry. First, they identify industries with strong growth potential. Next, they try to find an industry that seems like a great fit for their skills, goals, and resources. Then, after making a decision, they start to research the best franchise to own within their target sector.
Many Visiting Angels® franchisees took this exact path to franchise ownership. In looking at different sectors, they discovered the massive growth potential in home care and decided it would be a great fit. When they started to look at franchise rankings, they found that Visiting Angels frequently named the best franchise to own in home care.
Whether you’re buying a home care franchise or targeting a different franchise sector, here’s how to go about finding the best franchise to own.
Finding the Best Franchise to Own in Your Sector
Finding the best franchise to own in a particular industry is hard work. You’ll need a good understanding of the industry in question. You’ll need a strong sense of what to look for in a franchise opportunity. And you’ll need to research several franchise brands in your sector of choice.
What’s more, the best franchise for one person might not be the best franchise for someone else. That means you’ll need to account for local market forces and personal considerations, which lengthens the research process.
But all of this hard work pays off when you purchase your franchise. Given the high costs and high stakes of starting a new business, it’s important that you make the right investment. That’s a lot easier when you can identify the best franchise to own in a given sector.
Get to Know Your Target Sector
If you’re targeting franchises in a specific sector, start by getting to know the target industry. Unless you’re already familiar with the sector in question, you won’t become an overnight expert. But you’ll gain valuable info about industry conditions and what business ownership is like in this sector.
A little research can go a long way toward finding the best franchise to own. You’ll have a much stronger sense of what differentiates each franchise and where their business model fits within the industry. At the same time, you’ll know what to expect in terms of owning and operating a franchise.
Track Industry Trends
When you’re researching your target industry, pay close attention to current and expected trends. What kinds of market factors does the industry currently depend on? What kinds of market changes can you expect in coming years? And how will these changes impact the health of the industry?
It can take 18 to 36 months before a franchise is profitable. And it may be several years before you see a positive return on your investment. The best franchise to own will be well-positioned for industry changes and disruptions — things like new technologies, evolving demographics, and shifts in consumer preferences.
Check Franchise Rankings
If you’re searching for the best franchise to own, franchise rankings are a great place to start. While you can find a number of franchise rankings online, we recommend starting with the following two:
- Entrepreneur - Franchise 500. The Franchise 500 is widely considered the definitive list for franchise rankings. Based on factors like investment cost, average earnings, and unit growth, this is a great resource for ranking the investment potential of different franchise opportunities.
- Franchise Business Review - Top Franchises. Every year, the Franchise Business Review conducts a franchisee survey across hundreds of franchise brands. The resulting list can help you find the best franchise to own in terms of franchisee satisfaction.
Based on these rankings, you can generate a shortlist of top brands within your target sector. At that point, you’ll want to research these brands in more detail to find the best fit.
Research Top Franchise Brands
After you’ve narrowed down your list of possible franchises, you’ll want to start researching each brand in more detail. This will include a lot of basic due diligence, like reviewing costs and fees for different franchise opportunities, checking franchisors for red flags, and speaking with franchise owners from various brands.
During your research, you’ll also want to look at industry-specific considerations. Franchise documentation, conversations with franchisees, and discussions with corporate directors can provide invaluable insight into things like:
- Key points of distinction from other brands in the industry
- What to expect in terms of day-to-day operations
- How franchisees manage common industry challenges
- Which types of markets work best with the brand’s business model
- How the brand plans to adapt to industry trends and changes
At the same time, you’ll want to think about how certain brands reflect your own goals and vision. Franchise rankings can make it seem like the best franchise to own in a given industry is the same for every franchisee. But these rankings fail to capture how different brands occupy different places within a wider industry.
If your vision for your franchise doesn’t gel with your franchisor’s, you’re setting yourself up for failure. And that’s true even if they’re the consensus best franchise to own in your target sector. It’s a much better idea to target franchise brands that align with your vision, even if they’re the #2 or #3 ranked brand in the industry.
Learn more about franchise opportunities with Visiting Angels, named 2019’s best franchise to own in the senior care sector. Call 800-365-4189 or request information online.