There’s a big divide between those who want to own a fitness business and those who want to own a fitness franchise. The independent business owner wants to sit in the driver’s seat and build something from the ground up. The fitness franchise owner wants to be in the driver’s seat with a roadmap that also gives him directions. So how do you decide if franchising is or is not for you?

The Mindset
Franchising is not for people who want to invent a business. Aside from the founder who conceived and built the franchise model in the beginning, the business exists to be replicated.
Buying a franchise means purchasing the rights to operate that business, a system that has been designed and refined by a franchisor and then executed over and over again by the franchisees who have expanded the network. The most effective franchise owners are those who are very good at following a proven system while adding their passion and drive to grow their business.
The best way to think about franchising is to consider it as hiring a professional business consultant in a particular industry.

The Money
When buying a franchise, you will pay a franchise fee along with costs to rent, build and equip a location. You will need to cover basic operating costs, insurance and licensing. Owning this business is not a one-time purchase but an agreement with a franchisor to operate it for a certain number of years, at which time it must be renewed.
You will make royalty payments to your franchisor for weekly or monthly gross income. And you will likely pay into an advertising or marketing fund, which may include a portion of those dollars going into a national ad fund that may be used to attract new franchise owners and not support your particular outlet. These sound like large expenses for a franchisee on a local level. But magnified by the number of franchisees who operate under that same brand... you get the big picture.
A franchisee should expect to receive something from the franchisor in return for paying royalties, such as assistance with site selection and lease negotiations, marketing assistance and support, business support, website design and ongoing training and support. Basically, it’s like hiring a team of business professionals to help them grow their business.

Full Disclosure
To thoroughly review any type of franchise, you want to request a Franchise Disclosure Document (FDD) from the company. By federal law, every franchisor must create an FDD that discloses an overview of the franchised business, along with the associated costs and fees, a list of current franchisees, where they are located and more. Each FDD must contain 23 items of information, written in plain English that must be current for the franchisor’s most recent fiscal year.
The FDD is given to any prospective franchisee on the first personal meeting with a franchisor or 10 working days prior to the execution of a contract or money payment to the franchisor. This is purposely designed for every potential franchisee to make a fully informed decision before purchasing a franchise. The Federal Trade Commission requires this creation of the disclosure, and some states also require approval of the FDD before the franchisor is allowed to sell franchises within that state.

Discovery Day
Many franchisors offer a Discovery Day at their corporate headquarters. This is a regularly scheduled tour that is designed to review the franchise opportunity in person. And despite the travel costs, it is a recommended expense. Discovery Day allows prospects to talk with the franchisor's executives, view the resources that are available to support the franchise network, visit a location and study the business from the top level down.
Plus, these trips are not just for investigating who is going to help you open your franchise and walk you through training towards your opening day. Discovery Day is a way to see what is provided to every franchisee year-round, rookies and veterans alike.

Visit a Franchise Location
There is nothing more revealing than spending time at a real franchised location to understand what it is really like to own and operate that franchise. If you have a location nearby or you can travel to a location, it’s wise to spend time at that place of business to see the intricacies of how the business operates, how its staff interacts with customers, how the franchise makes money and if it is a place you’re still attracted to for yourself.

Potential franchisees might think they understand a business because they’ve frequented that business or one like it. But it is different to spend some quality time at an operation. Is it a busy place? If so, why? If not, why not? Are there peak times for the business? Are there down times for the business? How is the staff organized? Who does what?

What you read about the franchise opportunity needs to be supported by what you see at the grassroots level. Here is your chance to study the opportunity up close.

Talk to Franchisees
When you are awarded a franchise, you are initiated into a unique club of many peer franchise owners, and you begin a journey they have experienced for themselves. So consider existing franchisees a great wealth of information for the business you are evaluating.

You will want to talk to other franchisees in the business. How long have they owned the business? Why did they buy it? What has been the biggest surprise? What has been the hardest lesson? How was their return on investment? What do they think about the support they get from the franchisor? Would they do it again if they had to do it over? What would they change if they did?

Then talk to somebody who didn’t renew his or her franchise agreement. This information can be found in the FDD. Why did they leave the franchise? Would they say they failed at the business? What would have made them more successful? Who did they admire among their franchise peers when they were part of the network?

Lastly, if this investment has long-term implications for you as a road to retirement, talk to somebody who has successfully sold his or her franchise and considered it a good investment. Again, look to the FDD for this information. When did they decide they were ready to retire?

What was the process like for selling a franchise or multiple locations? How far in advance did they plan their exit strategy? How was it different to sell a franchise versus an independent brand-name business?
Scott Wendrych is the chief sales and marketing offi cer for Fitness Together Franchise Corporation ( He is also the president of elements therapeutic massage, inc.


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