We realize that it’s unprofessional to use the “f” word in business, but we’re going to do it anyway. In fact, we’re going to use several of them. You’ve been warned. These particular f-words often strike fear in the hearts of aspiring business owners. Fortunately, much like the monsters under your bed, they are a lot less scary when confronted head-on. Grab your flashlight and let’s shed some light on these scary f-words.
Almost without fail, the first question that all first-time, wannabe franchisees ask is, “How will I get the financing?” For someone looking to fulfill their dream of business ownership, the road seems paved with obstacles, not the least of which is where the money will come from to fund their business. If you’re exploring the idea of becoming a business owner, there are a few things that you can do to prepare for the process of acquiring the funds to finance your dreams.
- DO YOUR HOMEWORK
Your ability to secure a loan greatly depends on how well you present yourself and your company to prospective lenders. There are several business and personal documents that you will be required to provide, the sooner you start preparing, the better.
- RESEARCH LENDERS
Seek out lenders that routinely make the size of loan you need and who have some familiarity with your industry and geographical area. If your current bank fits that criteria, it's a good idea to start where you already have an established banking relationship. If considering a franchise, be sure to ask if the company has preferred lenders or a pre-approval process.
- GET YOUR FINANCIAL STATEMENTS IN ORDER
A prospective lender will look at the financial statements you provide within your business plan. This can be the most time-consuming (and sometimes overwhelming) part of the process. It's advisable to work with a CPA or other qualified financial consultant to create these statements.
- PREPARE A BUSINESS PLAN
The importance of a solid, up-to-date business plan cannot be overstated. When you apply for a loan, you will need to provide prospective lenders with a business plan that includes detailed information about yourself and the company. A good franchisor will provide tools to make this process easy for franchisees. For example, a “plug-n-play” business plan template may be provided to help in the loan process.
Systems run a company, and people run the systems. Truer words were never spoken. But knowing what functions you need in place in order to run a thriving business, then developing and implementing them, is often easier said than done. If nothing else, a successful franchise is a series of finely tuned, battle-tested – and then tuned again – functions. Franchisors create and put systems into place, many over the course of several years and hundreds of locations, giving its franchisees tried and true methods for operating well-oiled, money-making machines.
One function, for instance, that is absolutely necessary for every service business is what we like to call “Scriptinese.” Scriptinese is a language of its own, comprised of scripts so that your message is clear, and each team member is saying the exact same thing. Scripts create consistency and congruency in your business. Phone scripts, membership sales, and common customer objections are just a few of the scripts that we employ.
Regular training sessions to re-teach scripts and other systems are an important part of keeping your team on-point and your business running smoothly. Businesses experience turnover, staff become lackadaisical, procedures change or are improved upon – all of these things affect daily operations and frequent re-training sessions help ensure everyone is on the same page.
When vetting out different franchise options, be sure that you understand the level of support you’ll be offered. Procedures, training materials, plans and other similar materials will be a good indicator of just how prepared a franchisor is to support you throughout your tenure as a franchise owner.
FEAR of FAILURE
This one is particularly terrifying, as it contains not one, but two, f-words. And they are powerful words. We’re not going to lie, business ownership is scary. It takes time, money, dedication, and a lot of hard work. Many people put their dreams of business ownership on hold because they don’t think they have the money or that perfect plan that is required to go into business for themselves.
The beauty of investing your money in a franchise is that you get a proven business model, instant brand recognition (there’s power in numbers, people), and the support of a team of experts to help you succeed. As a franchisee, you can avoid the costly mistakes that negatively impact your bottom line and skip the process of trial and error that could impede your progress, because the franchisor has already worked out the kinks for you. Can you still fail? Of course. But instead of letting that fear of failure paralyze you, let it be the driving force to finding success.
As a franchise, the 9Round Home Office team helps people work through these problems on a daily basis. When franchisees allow the system to work for them, from securing funding, to implementing proven sales and marketing methods, they are able to see their dreams come to life. Sometimes, words are just words. Don’t let these f-words, or any others, stand in your way on the road to running your own successful business.