Click Before You Buy

A new online course helps potential franchisees learn the pros and cons of the industry.

Entering into a new business endeavor means new risks and challenges for every business owner, regardless of experience. Many, however, look to franchising as a possible low-risk opportunity. After all, franchising offers the support of a corporate office as well as feedback and assistance from fellow franchisees. Plus, the product is well-established, and there are marketing guidelines from the franchisor.

However, there are questions that should be answered before jumping right into a franchise agreement. For example, are you willing to work in a partnership with a designated management and operational system? Do you have adequate liquid assets to finance the start-up and operating costs? How much time are you willing to devote to the business?

To help entrepreneurs and small business owners decide if franchising might be right for them, the U.S. Small Business Administration (SBA) and FranNet, a franchise consulting network, have partnered up to offer “Franchising Basics,” a free online seminar that introduces users to franchising.

We’re trying to help them understand if franchising is an option they should be investigating,” says Jania Bailey, president of FranNet. “It is a very basic overview of the industry and can help them understand the pluses and minuses of franchising.”

Bailey says there are a lot of misconceptions about franchising, and the course tries to address those and make sure visitors have a basic, factual, and informative introduction to franchising. “If we gain their interest, they’ll pursue more exploration of franchising,” she says.

Accessible at www.sba.gov, the self-paced course encompasses three modules covering more than 15 topics, including “franchising pitfalls,” “financing options,” and “determining your objective.” Each topic is presented through a slide show with audio. Users can stop, start, and skip around to various topics as they choose. From start to finish, the entire course takes about 30 minutes to complete.

The objective of the course is to give users the rudimentary fundamentals of franchising so they have a general understanding of the process as they seek out additional information. “People can educate themselves with basic knowledge so they’re in a much better position to sit down with a business counselor and ask good questions,” says Jim O’Connor, director of SBA’s small business training network.

The decision to create the course evolved from feedback from various sources—such as SCORE, counselors to America’s small business, and the Office of Small Business Development Centers (SBDC)—that entrepreneurs and small business owners were interested in learning more about franchising. “We always are looking for new content,” O’Connor says. “We monitor what people are interested in and not interested in. We decided in cooperation with FranNet to develop a basic franchising course.”

FranNet and SBA have worked together for more than 20 years, and this was just the next step, Bailey says.

Both entities started on the franchising course last year, and “Franchising Basics” went live in March. Since that time, O’Connor says an average of 40 users a day check out the course. “We are finding that most who register for the class do go through the entire course,” O’Connor says. Upon completion, partici-pants can receive a certificate of completion.

The online franchising course seems to be an ideal outlet for providing information to participants. “We found that customers wanted to get in, get the information, and get out,” O’Connor says. “Also, the course topics are indexed, so they can go in and out as they please.”

Karen Spencer, CEO of FranSystems, a franchise education and consulting company in Atlanta, says she’s happy the course is available. “The more education out there, the better,” she says. “I’m thrilled there’s more education being offered.”

However, Spencer does have a few concerns about some of the content. “The basic program leans toward certain biased practices,” she says. “If you couple that with a lack of detailed information, it may lead consumers in the wrong direction or set up wrong expectations.”

For example, Spencer says, the content states that becoming a franchisee means entering a legal partnership. She says the franchisee is buying the use of the franchise name and operating system, but once the franchisor’s obligations are fulfilled, that’s it; there is no partnership.

Also, there should be more focus on “What is Franchising?” and less on “Is Franchising Right For You?” and “How to Choose the Right Franchise,” Spencer says. It should open the door to the basics of franchising versus the basics of buying a franchise, she says.

If visitors approach the course as a starting point to their research into franchising, Spencer considers the course beneficial. “Franchising can be extremely successful if people go down the right path and practice due diligence,” she says. “Hopefully, people will take it as an initial [start] and will really drill down and do the due diligence.”

Additional content for “What is Franchising?” is not out of the question. Both O’Connor and Bailey say there is the possibility of adding content to the existing course, but that would depend on participant traffic and feedback. For now, both are trying to get the word out about the franchising course itself. O’Connor says the SBA courses are getting a lot of activity by virtue of search engines, and partners at SCORE and SBDC are assigning the course as homework.

For both organizations, the more people who use the course, the better. “The goal is to educate as many people as we can on the franchising industry,” Bailey says. “Many start information gathering and realize it’s not for them.”

After completing the course, participants are directed to additional resources for more information and assistance. This includes links to local offices of consultants as well as other online tools, such as assessment tools and more online courses.

Overall, the online course is a good starting point for those considering the franchise arena. “It’s a great snapshot of what franchising is all about,” O’Connor says. “It’s a fair assessment.”

To review the course, visit www.sba.gov, and click “Review Courses” under “Free Online Training” on the home page. A brief, free registration is required to access the class. Visitors also can check out 25 other free, self-paced courses covering a variety of topics for small business owners.