George Cohon, renowned businessman and founder of...
As a prospective Canadian franchisee, you're very likely looking at various brands and industries to determine which opportunity presents your best chance at success. While brand and industry are certainly part of the foundation for franchise success, you also need another ingredient in this recipe: the right market. You must know who will buy from you and just who your best customers are going to be. When you can narrow down your customer field in the beginning of your franchise journey, you'll have a better chance of finding the business that will fill a need in your target area.
Research the local demographic
Who lives and shops in the area you want your franchise to be? What are their interests, age ranges, and other characteristics? Are there any types of recreational activities that are especially popular in the area? What about the area draws in unique needs? Gather all this information together and allow it to give you an image of your future customers.
Work backward from your preferred industry
If you already have an industry in mind, you can see how well this industry would fit in the area you want to operate. If you find it's not a particularly good fit, you can reevaluate your industry choice and consider alternatives.
Speak to the locals
Ask the people in the area what they want; this will be some of the best feedback you can possibly get. These are the people who will live and spend time in the area where your business is, so finding out what they are willing to spend more money on is definitely a wise move. To do this, you can put together a focus group, conduct online polls or send out a survey asking for feedback.
Look at other franchise locations
Once you have a brand or industry in mind, you can visit existing locations in that brand or industry. You'll see firsthand some of the work that goes into the business, plus you'll get some insight on who regularly shops or visits there.
Review the ghosts of businesses past
Think about the history of businesses in your area. Which ones have failed, and what caused them to do so? Which businesses have thrived and have been there for years? Of course, past failures don't mean you couldn't succeed with the same business type, and current success doesn't guarantee you'll do as well. However, by looking at what has worked and hasn't worked in the area, you may be able to spot patterns that will reveal more about what people in the area are looking for and what they are not interested in.
Understanding who your customers are early on in your franchise search can help guide you to a business that is right for both you and the area where you want to work. Take the time needed to truly understand the locals, their needs and their wants before you commit to your new business venture.