Why Demographic Information is Important For Franchise Buyers

Franchisees must be very careful with taking the franchisors word for everything about the potential location, and demographics of the area in which their franchised outlet will be operating. Often, franchisors want to space each of their franchisees equal distance apart so that all the exclusive territories touch and there are no empty spaces.

This makes sense because the franchisor wants to maximize the number of franchisees he can get into any particular region. This also means that some exclusive territories will be much better than others. Just because a franchisor wishes to put a franchisee in that particular location does not mean that the franchisee is going to make a lot of money.

There are far too many factors to consider, that is why I often recommend when buying a franchise that the prospective franchisee do his homework. That includes doing all the marketing research and data, even if the franchise buyer has to hire an outside consulting company to help them with the data.

After all, most franchise corporations would like to see their logo in every single shopping center in America, but that doesn't mean that the franchised outlets will survive in every single shopping center in America. Some neighborhoods just don't make sense for whatever it is that the franchise is selling.

If the area does not fit the ideal demographics it doesn't make sense to put your money on the line and take such a big risk. There are endless companies that do data research for marketing and you can find them online, or better yet hire an actual franchise consultant to help you, and perhaps, even assist you in putting together a mini-business plan. Please consider all this.

Lance_Winslow

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