Many business owners underestimate the importance of goal-setting. But planning out a rough schedule for your entrepreneurial journey can have huge benefits. By introducing targets, you’ll put yourself in a strong position to take action when necessary and move on when the time’s right.
We believe every franchisee should understand the importance of goal-setting and we encourage investors to determine their milestones early on and set a framework for measuring progress. Knowing how to set realistic goals is key to success as an entrepreneur, and the task goes far beyond writing a business plan.
Here’s our quick and simple guide to setting goals for your franchise unit.
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Why is goal-setting important?
- It helps you achieve your goals - At a basic level, knowing the milestones you want to reach gives you a much better chance of accomplishing them, as you’ll be able to plan ahead and prepare. Setting goals for your franchise business is key, whether you’re considering your next few years in business or your eventual exit strategy.
- Your end goals for your business will affect the way you run it from day one - Understanding your overall aim will give you the chance to adapt your working practices accordingly. For instance, if you intend to buy a franchise unit and quickly sell it for profit, your strategies and priorities will be different to those created by someone who is in it for the long haul.
- You can choose a franchise to suit your plans - Certain franchises offer specific benefits. For example, if you’re hoping to gain experience or make a quick profit and leave, opting for a low-cost franchise you can rapidly grow could be a wise move.
- You can make arrangements for your children to take over your business - Selling a franchise to your children is not as easy as it might seem. Just as you had to satisfy the franchisor’s criteria when you became a franchisee, your children would need to meet the same standards to take over the business. Being able to have a say in who assumes ownership of your unit and helping your children develop the necessary skills in good time are important steps in the process.
Factors to consider when setting goals for your franchise business
Here are just a few thoughts to keep in mind when selecting a franchise and planning for its future:
- The terms of the franchise agreement - It’s one thing to plan for your future, but another thing entirely to take precautions against unexpected and unavoidable events. Keep this idea in mind when first reviewing franchise agreements and only sign one when you’re satisfied you’ll have a good chance of surviving unforeseen bumps in the road.
- The level of support provided by the franchisor - Most franchisors are understanding and will do everything within their power to help their franchisees when necessary. After all, they only want the best for their brand. Often, franchisors can oversee the running of a franchise unit during difficult periods, so it’s worth checking the policies in place.
- The franchisor’s buy-back rules - If something goes wrong in the future or you change your mind about the investment, would the franchisor be willing to buy back your business? Having this guarantee is extremely valuable, so it’s worth bearing in mind as you research franchise opportunities.
- Whether you’d like to sell your business when you retire - Franchising can make a great alternative to retirement, but if you eventually decide to sell your business, you’ll want to make sure you get a decent price for it. Having this knowledge early on will help you choose a franchise with potential for ongoing growth and make sure your business continues to be attractive for investors.
Creating a success roadmap for your franchise business
There are several milestones you could aim to pass when running a franchise business: reaching your break-even point, building a team, forming business partnerships and opening additional locations, for example. But choosing strategic objectives to align with your ultimate goal will help you get the most out of your franchise opportunity.
Here’s how to set realistic goals:
1. Decide how you’d like to exit the franchise - Will you continue building your unit until you’re financially and emotionally ready to move on or retire? Will you sell your business for profit? Do you eventually aim to launch your own independent start-up? The answers to these questions will inform your approach to franchising from the get-go.
2. Select potential franchise opportunities and review their terms - Every franchisor will provide investors with a disclosure document and contract describing both parties’ obligations, as well as the franchise’s strategies. At this point, you can check whether the business will be able to provide the right opportunities and support to help you achieve your goals.
3. Talk to industry experts - No business owner should go it alone, and in the franchise industry, there are plenty of people on hand to provide support. Consult an independent solicitor with franchising experience when reviewing contracts, as well as a knowledgeable accountant for finance advice.
4. Plan the steps you need to take - The separate elements of your action plan will depend on the outcome you’d like to achieve. For instance, if you sell your business in five years’ time, you’ll need to demonstrate that it has consistently performed well, with high brand awareness and low staff turnover rates. See our guide to completing a franchise resale for more information.
5. Stay informed - The most successful franchisees are aware of developments in the business and franchise worlds. Take time to research your industry, as well as any current trends, and network with other entrepreneurs. You could also scout out potential partners and keep an eye on any potential buyers, such as employees who show an interest in business ownership. Remaining open to potential opportunities at all times will help you get the most out of any franchise.
>> Read more:
- Franchising 101: The Official Franchise Start Up Checklist (Part 1)
- Franchising 101: The Official Franchise Start Up Checklist (Part 2)
- New Year, New Career: No Better Time Than Now to Start a Franchise Today
- Franchising 101: 8 Signs You're Ready to Start a Franchise
- Starting a New Business Doesn't Always Lead to Immediate Success: Here Are 5 Ways to Change That
- It's Never Too Late to Start a New Business
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No franchisee should overlook the importance of goal-setting as a key part of their business’s development. If you’re in the process of getting to grips with franchising basics, take a look at our catalogue of business guides, which cover every aspect of the franchise universe. Or use the search box to find specific information.
Alice Tuffery, Point Franchise ©