Keys to Success for Franchise Business Owners
Brand equity, location, franchisor support, product or service quality, local competition, economic climate … all influence business success. We hope that the potential small business franchise owner will investigate these factors thoroughly as part of the due diligence process.
But the most important variable of all is the franchise small business owner and their skills to run the business. If you’ve never run a business before, how do you know you have what it takes to be successful? It is up to the potential small business franchise buyer to extend the due diligence process to include an objective self-assessment, something that the franchise buyer does not usually do in a formal way.
Assessing your business aptitude is a great way to gauge your likely success as a small franchise owner.
Entrepreneurship may not be what you think. The things that make you successful in American business aren’t necessarily the same as the skills you need to be successful as a small franchise owner. Graduating with honors, being a great team player in a Fortune 100 firm for several years, or being the captain of your college football or cheer squad has little to do with your entrepreneurial aptitude.
The dictionary defines “aptitude” as the “potential to acquire skill.” When applied to a business environment, it is the potential to acquire the skills to run the business. Who would want to buy a franchise without knowing that it has good potential for acquiring the skills to run the business?
But can business aptitude be measured in any meaningful way?
In fact, entrepreneurial aptitude can be measured. Studies of highly successful entrepreneurs define a profile of fairly common family backgrounds, childhood experiences, core values, personalities, and many more characteristics. Testing yourself against that profile of highly successful entrepreneurs is a great way to gauge your personal entrepreneurial aptitude. We encourage all potential franchise business buyers to “take the test before you invest.”
The proof is in the results
The most successful entrepreneur I have ever met fit the ideal test profile almost exactly. Even though he might have had limited success working for someone else, his results as a business owner were phenomenal.
He started his software business in his early twenties. He was an unimpressive-looking guy with unimpressive credentials. He didn’t have an MBA from Harvard; in fact, he never finished college. His experience was limited to a few years as a software developer. He had never managed anyone before starting his business. He was neither a charismatic personality nor a dynamic communicator. Clearly, he was not your typical corporate executive profile.
I worked with him for eleven years. He was constantly in awe of his invaluable instincts and skills, indicative of a born entrepreneur. He had a clear vision of where his business was taking and a passionate, infectious, and uncompromising commitment to getting there. He was brilliantly creative. He had a strong bias toward action rather than debate, even if he didn’t have the consensus of his senior staff.
He had started the business with no outside investors and retained full ownership. When he decided to leave the business, he sold it for an undisclosed amount of more than $ 500,000,000 (yes, I mean half a billion dollars with a “b”). And it was all hers!
He had the perfect entrepreneurial aptitude.
Take the test before investing
Getting a high score on a business aptitude test like the one we offer our clients is not a guarantee of success in running your franchise business, nor does a low score guarantee that it will fail. But it is a clear indication of how easy it will be for you to develop the skills necessary to run a small franchise and if you have the strength to do so. It is a very important step in the due diligence process of buying a franchise business that should never be overlooked.