It’s not surprising that you’ve decided to look into home improvement franchise opportunities. It’s the right market for opening your own business in remodeling, after all — the recession is over and homeowners are looking for ways to add lasting value to their homes. Expensive projects that were delayed for several years are now moving forward. And deciding to work under a franchise makes sense, too — if you don’t have a ton of experience in business, franchises give you a solid business plan and ample guidance. After all, they only make money if you make money.
Not every opportunity will be the right one for you, however. It’s worth noting that some companies and franchise industries have incredibly high failure rates. Restaurants often have trouble making it. Wings-And-Things has the highest brand failure rate, with 94% of franchisees failing to make it. Here are three signs that the franchise option you’re exploring is less than legitimate.
Bad Reviews from Franchisees
We’re all familiar with Negative Nancys who would find something to complain about even if they won the lottery. So don’t discount a franchise opportunity because of one bad franchisee experience. If the majority of reviews you read, and franchisee owners you contact, though, have troubling things to say about their experience, you might want to start looking at different construction franchise opportunities.
FDD Information Doesn’t Add Up
Under the Franchise Rule, a franchise must show you their FDD, or franchise disclosure document, at least 14 days before you are expected to sign a contract or pay any money. This document will tell you everything you need to know about the franchise, from the initial fees and future fees expected of you, to litigation the company is involved in, to restrictions on product sources. If something doesn’t seem to match up — if the FDD has numbers or information different than what you’ve been commonly told — be very wary.
Lack of Training and Support
Say you have experience with the home remodeling industry, but you’ve never worked with a granite countertop business, and your knowledge is more basic. If the franchise doesn’t give you enough support, you’ll likely be struggling to stay afloat in a competitive industry. Home remodeling businesses that thrive tend to have a good support system and a strong business plan backing them.
Are you interested in opening a home remodeling business as part of a franchise? Let us know in the comments.