Five common franchisee mistakes to avoid on your road to success

By Rick Villalpando

Whether you’re a first-time franchisee or about to open your fifth location, the road to achieving success is never an easy one. If you’re a potential franchisee who is considering entering a franchise system, there are a few common mistakes you can avoid to minimize risk, maximize return on investment and ensure you’re equipped for whatever challenges may come your way. Below are five common franchisee mistakes (and tips to help you avoid them) to keep in mind as you embark on your franchise venture.

  1. Investing in the latest franchise fads

When starting out in the franchise industry, it can be tempting to jump on the bandwagon and invest in whatever is hot and trendy at the moment. While popularity is great at the time, a truly successful franchise has withstood the test of time by weathering economic uncertainties and adapting to the various markets in which it’s located. Instead of getting caught up in the latest franchise fads, look for a well-established franchise that is innovative, forward-thinking with a clearly differentiated concept and adapts to industry trends without sacrificing its identity or the core of its business model.

  1. Not doing your homework

As a potential franchisee, you need to take the time to find the franchise that’s right for you. Not doing your research may put you in a negative situation that could have otherwise been avoided. Before signing on the dotted line, go straight to the source by reaching out to existing franchisees for their insight and experience in working with the franchisor. Take advantage of the information available to you—ask questions, voice your concerns and talk with current franchisees for a better understanding of the franchisee-franchisor relationship within the company.

  1. Trying to reinvent the wheel

Don’t enter the franchise business with the expectation that you’ll be making the big business decisions. While you do have some autonomy as a franchisee, you still have to follow the operating models, guidelines and processes set out by the franchisor. Invest your time, energy and resources in executing the operating model with excellence. The franchisor’s proven, successful ways of doing business will help ensure you achieve a return on investment. But keep in mind that if you’re looking for independence and total control over the business model, then the franchise industry probably isn’t for you. Spend your energy focusing on the day-to-day operation of your business.


  1. Being afraid of asking for help

The franchisor wants you to be successful, so never be afraid to reach out for help. The problems or challenges you face as a franchisee have probably already been encountered by the franchisor, so heed their advice. The support, expertise and company resources offered by the franchisor are an incredibly valuable asset that you should be taking advantage of. Ensure you’re maintaining positive, two-way communication with your franchisor. Make a conscious effort to connect on a regular basis, address concerns head on and respond to the franchisor in a timely manner.

  1. Running before you can walk

As a potential franchisee, you’re probably eager to jump head first into the franchise industry. While passion and motivation are great, don’t over leverage yourself financially or take on more than you can actually execute successfully. Ensure your first location is sustainable and thriving before you start looking to acquire others. It’s better to have a small number of solid, successful franchises than a large number of sites that are constantly encountering challenges.

By being aware of the common mistakes listed above, potential franchisees can help avoid pitfalls, while setting themselves up for success in the industry. Remember that the biggest mistake a potential franchisee can make is choosing an industry they don’t feel passionate about. If you love what you do and you believe in the brand, then it’s going to resonate with the franchisor and be reflected in your return on investment. Passion should always be the main motivating factor behind your decisions as a franchisee.

About the author:

Rick Villalpando is senior vice-president (SVP) of business development for RAMMP Hospitality Brands, the franchisor of Mr. Mikes SteakhouseCasual restaurants, based in Burnaby, B.C.