Wednesday, August 5, 2015

Leasing Your Location - Prepare for the Wait

With patience and due diligence it has taken you six month or more to lock-down your franchise. But are you ready for stage two of opening your business?

After discovery days, contract signing, training and other assorted preliminaries, you are eager to set-up shop. The franchisor has given you some guidance and criteria to select a location but now you are on your own. But, before setting you free, the franchisor, as a reminder, pointed out that clause in the franchise agreement requiring you to lease a location within 180 days. At least there is no pressure!

But prepare yourself ... this process of finding the right location, at the right price, and negotiating the lease could take longer than you think - perhaps longer than buying the franchise. I have had a number of clients go through this drill. It is a frustrating process.

So the best thing you can do is prepare yourself in advance that this going to take time and effort OR just wait until you are under the gun and be driven by panic.

But, here is the real dilemma: Do you look for possible lease locations before deciding on a franchise or get the franchise and then start the hunt? (many horse-and-cart and chicken-or-egg cliches could be inserted here but I'll spare you ... or not)

It seems difficult to look for a location before you have the franchise - too many unknowns: what is the business, where is it best located, what does the franchisor require, what territory in the franchise system is open, etc. etc? However, you can scout the potential areas you are interested in before you decide on the right franchise. Educate yourself. Learn the leasing market. Contact a commercial realtor. Develop some idea of the cost and availability.

Although some franchise systems are intensely involved in the selection process, most leave the ultimate responsibility of selection to the franchisee (franchisors disclaim responsibility for the profitability of a location). So get ahead of the curve and bone-up on the leasing market in your areas of interest.

You might even impress the franchisor.

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