7 Mistakes To Avoid When Buying A Franchise

Buying a franchise is a great opportunity to go into business for yourself. As you start the process of choosing a franchise, it is important to avoid these seven common mistakes that could be potential pitfalls to your new business.

franchise

Buying Into The Hype

Many companies will claim to be the greatest but buying a franchise is a business venture. In business, there is, unfortunately, no such thing as a sure thing. Not all franchises are equal, and not all of them will result in instant or long-term success.

Not Doing Market Research

It is easy to get excited when shopping for a franchise, but do not let that excitement keep you from really digging in and doing the necessary market research. While a franchise make look like a great opportunity at first, it is imminent to know how well your franchise will do in the marketplace.

Choosing the Newest Franchise

For many, the main draw to purchasing a franchise is the fact that you also obtain the brand name and proven record of that company. While the newest franchise might be enticing, investing in an up-an-coming business can be very risky.

Not Having an Emergency Fund

While researching different franchises, you will likely carefully calculate the franchise cost, fees and ongoing royalties but it is important to have an emergency fund in place in case your new business does not start turning a profit as quickly as you expected.

Not Having an Exit Strategy

Understanding the terms of your contract is obviously vital and while you may be focused on what it includes in regards to your business running successfully, it is equally important to know what will happen if your situation takes a more negative turn. You should be informed as to what will happen if you close your business before your contract is up or if your business goes bankrupt. Obviously, you hope these situations do not arise, but being informed will help if they do.

Not Hiring a Franchise Advisor

Buying a franchise is a big financial investment but investing in legal advisors is equally vital to the success of your business. Having a franchise attorney can be extremely helpful as they can help you to understand and negotiate your contract, and show you what to avoid during the process.

Assuming the Franchisor has Your Back

It makes sense that your franchisor will want your business to succeed, but at the end of the day they will protect their own interests first. When it comes to business, it is important to remember that they may not always have your best interest at heart.

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Protect Your Intellectual Property

Protecting Your Intellectual Property

If you own a business, you have intellectual property and while protecting it may seem like a daunting task, it does not have to be. With the right information and guidance, you can prohibit others from using your ideas, creations and so forth. The right protection is so important, because without it, you could experience loss of revenue and possibly clients. Your ideas, inventions, logo and even your business’ name can all be legally protected if you take the right steps to make it happen.

intellectual property

Knowing Your Rights

As a business owner, you have rights available to you to protect your intellectual property, and knowing which right, or rights, you need is essential. A trademark is used to protect your business’ name, symbol or logo, and keeps them from being used by anyone else. When protecting your original works like books, videos or songs, a copyright is used to prevent others from distributing, selling or making money off your work. Patents are specifically designed to protect your unique inventions, ensuring others will not be able to make, sell or use them.

Seeking Advice

Once you understand your rights, it is important to speak to an attorney who can evaluate your business and intellectual properties. An attorney will be able to use that evaluation to advise you on what protection you need and how to avoid making any mistakes. As always, with business, talking to an attorney who is experienced in your specific industry, is an advantage.

Plan Ahead & Act Quickly

If you are starting a new business, protecting your intellectual property needs to be one of your first priorities. Protecting your intellectual property is so important and can be crucial when getting your new business off the ground. If, for some reason, you already have a business up and running, but do not have your intellectual property protected, it is not too late. Act quickly, because even if it is just your business’ name and logo, it is yours and you deserve to have that protected.

You worked hard to start your business and you continue to do so as your serve your clients. Make sure all your hard work, and the work of your employees, is not in vain by protecting your invaluable creations, ideas and other intellectual properties. Do not give someone else the chance to benefit from your creativity and expertise, place a legal lock on your intellectual properties, just as you would your storefront or shop.

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