New franchisees sometimes carry with them misconceptions about the business that can be detrimental to their success. Those who’ve been there and done that from the Association of Filipino Franchisers Inc. share some of these mistakes with us, and how to best avoid them:
Common mistake #1: Treating your franchise as a sideline. A lot of people get into a franchise “thinking they don’t have to work” and that it “works on auto-pilot”, YSA Skin Care president Robert Nazal and Holy Kettle Corn Chief Operating Officer Aristotle Alipon observe. On the contrary, you need to put in your time, hard work, physical presence, and care to make your franchise grow. In the absence of a professional managing team, a business will always need the hands-on management of it’s owner, says Bibingkinitan and The Tea Square president Richard Sanz. “That is why we require all our franchisees to log in at least four hours per day in their franchised outlet to ensure their focus,” he says.
Common mistake #2: Neglecting to improve yourself. Pica Pica Franchise Director Mercedes Mejia believes that being a business owner means having good people skills and having the ability to manage employees. So take courses or study articles that teach about management and self-improvement; when you improve yourself, you improve your business.
Common mistake #3: Focusing on money too much. “Relatives of OFWs often come to the office and wave their money around, thinking that it is the only thing needed to acquire a franchise,” shares Canton Dimsum House owner Gilbert Jim. He says an applicant must also consider if they have proposed the right location, and if they can manage the franchise well. Others make the mistake of choosing franchises based on price and affordability, shares Nazal. Although financial gain is one of the reasons to franchise, it should not be the ONLY reason. “In our franchise orientations, we always mention never to work for money,” says Sanz. Among his franchisees, those who work with zeal and passion are the most successful because “their passion for the product and business drives them to excel, then the money abundantly flows afterwards as a result of their passion and zeal.”
Common mistake #4: Charging personal expenses to the business. Some new franchisees make the mistake of charging their family’s expenses like groceries and other utilities in the income of their franchise; this eats up their operational expenses and messes up their financial accounting. Aquabest’s Neil Delgado suggests to “Get a salary from the business then deduct your personal expenses from there.”
Common mistake #5: Having unrealistic expectations. Although the failure rate in having a franchise business is relatively low, all franchisors agree that they cannot guarantee a 100% success rate because it depends on a variety of factors. Some franchisees expect their franchisors to do everything for them, which is a common misconception. While franchisors are there to support and guide you, managing the business and running it lies on your hands. You also need to manage your expectations. To prepare for the natural highs and lows of doing business, “they should have a passion for the business they are entering, “points out Jovic Navarro of The Cockhouse. “Study the market well and be prepared for the lows because there will be dips in your income,” advises Alipon. At the end of the day, your franchise’s success actually depends on you.
Knowing what not to do helps you focus on what you need to do in order to succeed. Cheers to a great year ahead! ●
The Association of Filipino Franchisers Inc. (AFFI) seeks to professionalize and standardize the local franchising industry. For more details, log on to
LESSONS TO BE LEARNED
Some mistakes new franchisees make and how to avoid them
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JAN/FEB 2008 • GLOBE MASIGASIG •
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