The franchising industry is vast, so you will do your due diligence to find the right fit for you. Franchisors are in the same positions; they receive multiple applications from aspiring entrepreneurs, so they will have to do their due diligence on each of them. The franchisor typically wants to know why you are interested in their brand, the strength of your business plan, and your capacity to run the business. It’s part of their pre-qualifying for a franchise the critical stage before engagement.
Can you afford the franchise?
Whenever you buy an asset (like a house or car), you need to pre-qualify to determine what you can afford. Franchise funding works similarly; you must pre-qualify to be eligible for a franchise. On average, franchises are between $20,000 and $200,000; you can get a franchise for as low as $5,000 for a mobile or home-based business or pay millions for a hotel or restaurant. The variety in franchising options, especially as you go up the scale, necessitates knowing what’s within your reach.
Requirements necessary for pre-qualifying for a franchise
When you join a franchise, you are part of a team. The collective success of the franchise depends on the performance of the franchisees. That’s why franchisors set minimum financial and other requirements to qualify to run a business with their brand. Some franchise requirements include the following;
- Minimum credit scores vary according to each franchise; in general, most consider 680 as ideal.
- Depending on the initial investment necessary, the franchisor will have a minimum net worth to get ownership.
- The amount of cash you have. The cash must cover initial franchise costs or a down payment if it’s a loan purchase.
- Industry experience is rarely a must, but it always helps your case.
- Most franchises need staff to function. While management experience is preferable, it’s not the end-all and be-all. The franchisor will be just as happy if you can demonstrate your capacity to multitask, delegate, and get things done through other experiences.
Fusion Franchising offers lower risk and a profitable entry into entrepreneurship for anyone. Don’t let pre-qualifying for a franchise overwhelm you. Contact Fusion Franchising now, to get started on your journey.