Tony Melvin. Photo: Jon Reid
How to ... know if you have the right qualities to be a successful franchisee, with Tony Melvin.
DON'T try to reinvent the wheel. In franchisees, I look for people who have an entrepreneurial flair and want to escape the nine-to-five grind and start their own business.
But, at the same time, it's important we don't get somebody who's too much of a maverick or renegade and simply wants to do things their own way.
It's a very fine line but you have to like following systems. Good franchises are like road maps: we've paved the way for you but if you deviate off that road, you'll get into trouble.
That doesn't mean there's no room for innovation. I encourage ideas for new services or products but their delivery has to adhere to established procedures.
A lot of innovation in McDonald's came from franchisees, especially in the early days, but it was very strict that when a burger got made, it got made a certain way and when chips got fried, they were fried a certain way.
Be realistic. The income potential in our business ranges from $120,000 to about $250,000 a year. But you're not going start earning that kind of money within the second month.
So it's important you don't go in with an expectation that, ''It's going to be easy, it's all going to be done for me and I'll be rich in the first few months''.
You've still got to build a business and I think that's probably a wake-up call for potential franchisees.
There are a lot of franchises that promote a lifestyle where you're your own boss and you can sit on the beach. But the reality is it's just not true; there's not a single business that doesn't require you to work - you've actually still got to do something.
Be passionate. Experience is not always necessary. What's more important is a desire to work in a particular industry. If you don't have some passion for the field and you're just doing it to make money, that would be a big flaw to begin with because money only motivates you so much.
Communicate and take charge. Managing staff brings another dimension to a franchise.
You've got to have guts and be willing to let people make mistakes. Once the business gets going, you may have to give someone the responsibility of looking after clients or developing products and services.
It's a very scary thing to do for the first time and, if they make mistakes, it may cost you a lot of time or money and make you fearful to do it again.
With a franchise, it's often easier because there are systems in place but, in the end, it's a personality trait.
You need patience, courage and the ability to train and develop people.
Keep up with industry trends. We've seen the franchise boom in the food business but professional services in Australia are going to go through a tremendous boom in franchising - from accounting, some legal services and many parts of the inspection industry, such as occupational health and safety inspections.
The reason is the introduction of online and cloud-based computer systems, which give you the ability to work from anywhere. We have no corporate head office and our staff work from home around Australia.
This technology will create thriving franchise opportunities in professional services for those who are ready to deliver them.
Tony Melvin, chairman of Resicert Property Inspections, is the author of several finance books.