Do you know you’re gross and net? How about you P&L, CPS, PE Ratio, RPI, RRP or VAT? Do you have stock on the LSE, NYSE or NIKKEI? Do you do deals in pound sterling, American dollars, Hong Kong dollars or Bitcoin? Do you know what any of this means and do you need to?*
Starting a business can be like going from the swimming pool to crossing the channel. It’s hard. The learning curve is incredibly steep and no matter how well prepared you think you are there will be something that comes around unexpectedly. It can be the seemingly little things that trip you up; if you use a cloud based system what happens when the internet goes down? Or it can be the huge things; you know that you have a great product so why doesn’t the buying public agree? There are a thousand and one questions that will come up, you often realise that you don’t know the answer only when someone ask the question.
Mentoring by an experienced business person can be a great way to help you along your path. They will be able to answer a lot of your questions and sometimes talking through a problem can be the means of seeing the answer. The problem is that they are not really invested in your business and they won’t know the problems you have as well as you do.
An option people are increasingly turning to is to buy a franchise, either a new start or a resale. With a franchise you will start by being trained in the franchisor’s systems, systems that have been tested, retested and developed until the franchisor is sure they work. You will have the support you need on the end of a phone by someone who knows the challenges that are unique to this business model and has a vested interest in your success. You will have a national name and the benefit of their advertising. It’s your business but it comes with a support package and a helping hand.
If you buy a resale you will be charged the cost of the business as well as the fees from the franchisor but the initial legwork will already have been done. You will be able to provide accounts to a bank which will help if you need financing with a resale and you will have an income from day one.
If you buy a new start you will be given a territory by the franchisor and with their help you will develop the area. There will be a lot of work to start with but you will benefit from the national name and the upfront costs are lower than with a resale.
Before you buy either type of franchise you will need to meet with and be approved by the franchisor. They will make sure you are the right person for their business. You are not an employee but you will become the local face of a brand they have spent years building up. They will want to make sure that you will be a good fit and that you have the best chance of success possible.
Whatever you decide to do there will be a lot of challenges ahead. Business is a lonely place but you can make it easier on yourself by being well prepared, having in place the help you need and by going out and networking with other small businesses who will be just as terrified as you. Good luck!
*The answer is you need to know some of it. Gross and nett are how profit is presented before and after tax deductions. P&L is Profit and Loss, CPS is cost per sale (how much you have to spend to make each sale), PE Ratio is price to earnings ratio, RPI is retail price index, RRP is recommended retail price and VAT is value added tax. LSE is the London Stock Exchange, NYSE is the New York Stock Exchange or NIKKEI is the Japanese stock Exchange. You’re unlikely to need this. Yet.
Written by Harriet Ennis