How to make money out of your franchise

X-Press Legal Services franchisee Karen Underwood provides some expert advice on building a profitable franchise business

Karen Underwood has been a franchisee with specialist property search provider X-Press Legal Services for six years. Last year she was named the company’s Brand Builder of the Year.

Before joining X-Press, Karen was managing director of her family’s funeral directors business until it was sold after her dad retired. Originally she had trained as a classical ballet dancer.

Karen says: “When the family firm was sold, I didn’t know what I would do next, except I was sure I wanted to be my own boss. I knew nothing about franchising but, just by chance, I saw an article in the Daily Mail about a very successful X-Press lady franchisee, which really inspired me and made me realise how many great opportunities there are in franchising.”

Do your homework
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Here’s Karen’s advice for franchisees: “There is much to consider, so thorough research is the first step before making any firm commitment to a particular franchise. Don’t get carried away by all the exciting prospects on offer until you’ve done your homework and are quite sure you want to go ahead.

“Research the franchising concept and understand its benefits and advantages from the wealth of information available from the British Franchise Association, franchise columns in the papers, franchise magazines and exhibitions. Question your motives. Assess your suitability, as not everyone is cut out to be their own boss. Look critically at yourself - your strengths and weaknesses. Buying a franchise is a big step to take, especially if you are used to the structure of a large organisation and the security of a well paid job.”

It’s a big commitment
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“Understand that buying a franchise means making a big personal, as well as financial, commitment. Being happy in your work is important, so choose a franchise you will enjoy because you will be doing it for some time, typically not less than five years.

“Be realistic about how much you can afford to invest and how much working capital you will need.

“Franchisees have responsibilities and obligations as well as franchisors, so you must understand what is expected of you. Make sure you get good independent advice to help you.

“I strongly recommend appointing a specialist franchise lawyer. Don’t be tempted to use your friendly local family law firm to check the franchise agreement, but instead consult the bfa’s list of affiliated lawyers whose knowledge, experience and expertise are invaluable and could save you a great deal of money in the long run.”

Choosing the right franchise
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“Once you’ve identified the right franchise, meet the franchisor to make sure you like and trust each other. The chemistry has to be right.

“It is vital to feel comfortable with your franchisor and their system. Successful franchising depends on establishing a good rapport with your franchisor and following their procedures. If you are not happy with either, follow your instinct, walk away and look for something else.

“Check the business model really does deliver, based on your own assessment and by talking to other franchisees. If the franchisor is happy for you to speak to anyone in their network, not just the ones they suggest, it is a very good indication that the franchise is a good, solid and well run business.”

Keeping up to date with your sector
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“Franchisees have to take in a great deal of information very quickly, so it’s extremely helpful to be given it from their franchisor, a reliable and trustworthy source. This has two advantages: firstly, the assurance that the material is accurate and up to date and, secondly, it saves franchisees time because they don’t have to do their own research, which they would have to do in an independent business.

“I believe that franchisees work on their business, whereas franchisors concentrate on working on their industry. Having timely information is crucial when major changes occur, for example, new legislation. “Being able to rely on your franchisor is a major advantage over setting up on your own. This confidence makes a big contribution to a franchisee’s performance and success, especially in the early days. Working on your own can be a lonely experience, so it’s reassuring to know your franchisor is there with help or advice, whatever stage your business is at.”

The practicalities of being a franchisee
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“Creating a successful franchise is achieved with determination, hard work and tenacity. It also requires support from the family to provide flexibility to work around business and domestic commitments. The family’s tolerance is vital to ensure the smooth running of both household and business, which is especially important when it’s necessary to work late or at weekends.

“Nowadays many businesses can be run from a home office. This can be an advantage when setting up a franchise because it keeps initial investment and ongoing overheads low. Working from home has many pros and cons, but for most people it is a happy experience and is usually very successful. If you choose this option, establish some firm ground rules for the family right from the beginning and make sure everyone sticks to them.”

Client relationships
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“It goes without saying that you must have a good relationship with your customers - because without them you wouldn’t have a business. Not everyone is a natural at dealing with people, so training in communications skills from your franchisor is essential before starting to trade.

“Franchisees must ensure their employees are trained to the same high standard. I work on the basis that you must provide a high quality service that you would expect yourself and that nothing else will do. A good maxim is always deliver on time and keep promises.

“Give exemplary customer care, so your clients know they can rely on you. Being prepared to go the extra mile brings its own rewards and keeps your clients, which is more valuable than worrying about how to make a fast buck. I like to go to bed at night and sleep easily knowing I’ve done a good job.”

Hands on
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“Finally, prospective franchisees must understand that buying a franchise means not only succeeding as a franchisee, but also being an efficient jack of all trades to cope with all the mundane tasks that need to be done in any small business - everything from ordering the stationery to hoovering the floor.

“Multitasking is definitely essential in franchising, which is probably why so many women are so good at it.”