How Do Successful Business Owners Avoid Shortsightedness?

Success Strategies for Avoiding Typical Business Ownership Mistakes: Part 3
Success Strategies for Avoiding Typical Business Ownership Mistakes: Part 3

The excitement of starting a new business can sometimes blur your vision. And, if you have never owned your own business, it is easy to fall into many novice mistakes. This holds true for a startup or a franchise. Often people feel that they are immune to some of these missteps when purchasing a franchise. Franchise ownership can help you to better navigate business ownership waters and chart a smoother course. But remember successful entrepreneurial voyages depend on the captain who executes the plan.

In the first two parts of this three part series, I covered the business selection process and common financial mistakes that can put you at risk. In the final part of the series, I discuss “shortsightedness.” It takes a balance of looking at the here-and-now while also focusing on the long-term goals. Realize that shortsightedness impacts all of us at one time or another and for many different reasons.

When it comes to a business, you want to always be looking to the future knowing that your decisions have both a personal and a professional impact on all involved.

Here are the next three of the most common myopic mistakes that you can make and you can successfully avoid them.

Mistake #8: Viewing franchise ownership as a short term endeavor. There are people who are “starters” but not finishers in the world. Starters are those people that like to start things but not always finish them. They may like starting businesses, getting them up and running, but want no part of the day to day operations. They tend to like the challenge of the unknown, but hate the routine or mundane.

Success Strategy #8: View franchise and business ownership as a minimum of a five-year project. It takes time to get the business fully operational, and it can take time, possibly up to 2 years to find the right buyer to purchase your business. And, when owning a franchise, the sale is not just dependent upon you and the buyer coming to terms, you must also understand the franchisor’s transfer process and requirements.

Mistake #9: Hiring the wrong kind of attorney or no attorney at all. There are two potential pitfalls here. Although it seems cut and dry, and there is the Franchise Disclosure Document that tells you everything you need to know about the business. You may be asking:

  • Why can’t I have Uncle Bob look at the paper work? He’s been an attorney as long as I can remember. “I’ve heard the war stories; he’s seen everything.” 
  • Why do I need any attorney? I sign other paperwork without consulting an attorney. 
You want an attorney that is intimately familiar with franchise agreements and Franchise Disclosure Documents. There is rarely any negotiation in these documents however you want to be aware if something is not standard. You do not want someone who is arguing points that cannot be changed and running up your bill. Qualified franchise attorneys will quote a flat fee for reviewing your documents. If an attorney is not familiar with these types of agreements and does not work with them on a regular basis, he or she may be spending a lot of time getting familiar and understanding the requirements.

Success Strategy #9: Hire an attorney with ample franchise law experience to review the Franchise Disclosure Document, franchise agreement and related contracts and documents. Your consultant should be able to give you a few referrals to experienced franchise attorneys. It will be money well spent.

Mistake #10: Not including your spouse in the decision process from day 1. Although your spouse may not be operating the business with you, it will be impacting him or her too. Your spouse needs to have some understanding of the business so that he or she knows what to expect once you start operating the business.

Success Strategy #10: Include your spouse in the process and make sure your spouse is supportive of this venture and understands how life will be different. Owning a business is a family affair. In the first year, it could mean cutting back on spending or schedule changes. You want your spouse to be your partner not just in life but in your business. Including your spouse will help you to avoid the stress of a strained relationship.

There can be many obstacles, challenges, and rewards in business ownership. You are the captain of your ship and if you want to successfully navigate these waters do not commit these novice mistakes. It could adversely impact your voyage to success.

To recap your 10 success strategies discussed in this series:

  1. Don’t fall in love with the product or service. 
  2. Don’t select a business just because you have experience in that industry. 
  3. Do look at your business as a means to an end. 
  4. Establish the appropriate partnership documentation, if you plan to have a partner. 
  5. Investigate current franchisee’s outcomes to better understand the financial outcomes. 
  6. Know the numbers so that you can plan for adequate funds. 
  7. Borrow the proper amount so that you can service any debt. 
  8. Look at franchise ownership as a long term endeavor. 
  9. Hire a franchise attorney. 
  10. Include your spouse or loved one in the decision process.
After working with small business owners for many years as well as years in a corporate setting, I can attest that it is easy to be shortsighted. This is why it is so critical to have someone that is your coach and advocate who is there to remind you of your goals so that you do not lose your way.

At FranNet we help people understand if franchise business ownership is right for them as a path to self-employment or an investment, please give me a call at 678.249.9867 or message me via LinkedIn to learn more.

Julie Denise utilizes her 30 years in financial services now as an independent businesswoman and FranNet of Atlanta consultant. Since 2012 she has enjoyed connecting people, guiding those in career transition and expertly assisting those that would like to explore business ownership through franchising.

A graduate of Northwestern University, Julie volunteers with Atlanta Jobseekers, RUMC Career Ministry, is a Chapter Leader for the Business Executives Networking Group (BENG) and is a certified SCORE mentor.

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