Buying your own business can be difficult at times. However with Greg from Franchise Advice, he will point you in the right direction. Franchise Advice specialise in helping first time business owners. Being your own boss and purchasing a business can sound like a good idea. But if you don’t take the right precautions you may fail. Investing your life savings without protection can end in losing everything, including the shirt off your back.
Why you need to meet with Franchise Advice
The business owner of Franchise Advice Greg Longstaff, sees this first hand, time and time again. People hastily buy a business and from there it can go one of two ways. 1. It can flourish and be successful, or 2. It can be a recipe for disaster. However if you make a small investment for professional business advice, you could avoid a financial disaster.
Taking over a franchise or small business is appealing to many new buyers as you enter into an existing business model. Often this comes with established systems and a recognised brand name. This means that you, as a buyer, can be up and running in a shorter amount of time. However, franchise agreements have the potential of turning wayward if you don’t fully understand the agreement you’re entering into.
What many new buyers don’t realise is vendors tend to use their own ‘poetic license’ to persuade a buyer into the purchase.
To put it simply, they will tell you what you want to hear in order to make the sale. This is where you must do your own research to make sure you are buying a cash cow type business. If you decide to pursue your newest endeavour you will find yourself entering into a legally binding contract, known as a franchise agreement.
These documents can be daunting for both new and established buyers, especially when you are faced with a lengthy document filled with technical jargon. This agreement will control what you do, when you do it, and ultimately oversee the relationship you have with the franchiser. At this point it is important that you, as the franchisee, fully understand the agreement you are entering into so that you can be completely in control over your new business.
Many first time buyers overlook the important things such as a full understanding of their territory for example. Where does it start and end, can you put more sites close by on my doorstep etc.
But who is really the right person to consult?
When you are sick and need expert advice on your health, you would go to a doctor, not someone unqualified. When you’re purchasing a car you would get a mechanical check from a specialised mechanic – or so we would hope. So when you’re purchasing a business, you need to go to an expert. Lawyers and Accountants are the first people you should consult, and rightly so. They can advise you on the legalities of the contract you are entering into, offer specific financial advice and highlight any flaws.
But these professionals may not always be experienced with franchise agreements, nor will they continue to follow you on your journey. After getting this advice at a hefty cost, the ball will be back in your court to make the next move, usually still unaware of future problems that may arise.
That’s where Franchise Advice comes in.
Enlisting the help of Franchise Advice gives you the opportunity of an expert assessment on the business so you can be fully aware of the agreement you are entering into. After legal and financial professionals look at the agreement, Franchise Advice goes directly to the vendor (on your behalf) to get clarification from them (this could be the franchisor or their representatives) on clauses specific to your purchase. These may include terms, payments, training, management and trademarks.
The process of Franchise Advice is to have a recorded interview with the vendor on your behalf. Drilling down on these specific clauses and clarifying their true intent. Common aspects that can be overlooked in franchise agreements include the obligations of both parties and the specific territory in which the franchisee is allowed to operate.
We ensure no poetic licence can be used by the vendor, resulting in clarity and future stability for your new business endeavour. As well as this, the interview is then transcribed and signed by all parties to ensure ongoing clarity.
Franchise Advice have been in the Franchising industry for over 30 years.
They have seen vendors abusing the trust of buyers time and time again. That is why Franchise Advice can offer protection for new business owners and purchasers. They endeavour to safeguard new buyers from being railroaded into something different to what they believe they are buying.
Trusting an expert is important and they can tell you which aspects of your new agreement are justified, which are not, and how you should act next. Make sure you take the right precautions so you don’t lose the shirt off your back. You need the right people on your team to be successful, and we want to be a part of your success.
by Phoebe McCreath, Journalist.
Franchise Advice is the trading brand of Franchise Australasia Limited