*Know yourself before you buy a franchise. Your franchise will become an extension of you.
*Before doing any research, take some time to figure out your own interests. Determine your long term strategy for getting into franchising. This will form the foundation that you can then build upon.
*Make sure you understand basic business principles, and how to read and understand basic accounting statements (i.e., balance sheets, profit & loss statements, cash flow statements, etc.).
*Since most franchises require active ownership participation, do an honest assessment of your strengths and weaknesses. From this you can figure out many things.
*Don’t just research “hot” franchises. This is a recipe for disaster. First figure out your interests, then limit your search to franchises that are within your interests.
*Get involved in the community within a 10 mile radius of your franchise. Develop relationships with those around you. This is more important than you might think.
* Only believe about 50% of what the franchisor tells you. There job is to sell franchises. The numbers they give you will be based on averages over their entire system and not necessarily reflective of what you will make or even potentially make.
* Speak to many franchise owners and current owners within or formerly in the system you are interested in. This is perhaps the most important thing to do before you buy a franchise.
*Have a detailed list of questions to ask current and former franchisees.
* Hire professionals to help. You should never sign the contracts without out first hiring a franchise attorney. You should have a CPA review the numbers. And you need to have an insurance person and a banking relationship.
* Plan for tough times. Not because you are guaranteed to go through them. But because in the event that you do, you need to be prepared so you can work your way through them.
*Understand that the costs will likely be 2-3 times more than you expected. Have a safety net.