As more and more individuals are faced with the reality of corporate layoffs in California, the question of “What is the best franchise to buy in California?” is becoming more and more prominent as potential business owners use the opportunity to take their career into their own hands. At IFPG, we have over one thousand franchisors that offer a variety of businesses to invest in, and our franchise broker group is here to guide those facing layoffs down the path of business ownership.
Navigating the franchise landscape can be tricky to newcomers, especially when coming from a corporate environment that offers more stability and clear definitions of responsibilities. In this quick guide, we will cover the following topics to give you an understanding of how to go about investing in a franchise business:
- Pros & Cons of Franchising
- Questions to Ask Before Investing
- Popular Franchises in California
- How to Get Started on the Path to Franchise Ownership
Pros & Cons of Franchising
Franchising has grown in popularity in recent years, and for very good reason. Franchise owners benefit in numerous ways by investing in an established brand – little to no start-up costs, a well-known name with high brand recognition, and guidance from the franchisor.
Overall, franchising offers security in business. With their established marketing efforts, existing customer recognition, and support from the franchisor, it could be easier to run a successful business by franchising than starting from scratch. In addition, most franchise businesses require a lower overall investment since all the basics like amenities, supplies, and the concept are all contributed by the franchisor.
That said, one of the biggest drawbacks to franchising is the fees and royalties required. Franchising requires very strict adherences to the brand and many franchisors ask for a percentage of sales. While the guidance offered by the franchisor is invaluable, the fees involved could be daunting.
Questions to Ask Before Investing
Before investing in a franchise, there are many questions to ask. From understanding the franchisor’s expectations to considering the resources needed, the first step to investing is doing your homework.
On the legal end, it’s important to be aware of the laws and regulations surrounding franchising in California. Additionally, review the Franchise Disclosure Document (FDD) which provides a detailed description of the franchise system, including its risks. On the operational end, consider the profits and losses one could see while running this type of business.
Furthermore, evaluate the franchisor’s past successes and issues faced with existing franchise owners. Take a look at the main competitors and their offerings, and decide if there is a void in the franchise market that your business can fill. Be sure to consider the resources available, the budget for training and advertising, and needed professionals such as a lawyer and an accountant.
Popular Franchises in California
With many people looking for ways to capitalize on the California market, it’s not surprising to see some of the most popular franchises resonating with investors in the region. Here is a list of some of the top franchises currently present in California:
- Sonic Drive-In
- Taco Bell
- Little Caesars
How to Get Started on the Path to Franchise Ownership
Once you’ve done the research to identify the ideal franchise to invest in, getting the actual investment process started is the next step. Being mindful of all the documentation and paperwork involved is crucial. Working with a franchise consultant or broker is strongly recommended. We would be more than happy to help you navigate the process with our vast network of resources.
At IFPG, connecting aspiring entrepreneurs with successful and trusted franchise businesses has always been our top priority. We take pride in our strong commitment to ethics and integrity, and hope to continue guiding those looking to invest in a franchise business for the years to come.