When you start a franchise, all you can think about is success. You envision leveraging a great business model, a strong brand, and your own hard work to build something special. You're motivated, committed, and ready to go. And while that drive is essential, the reality is that not every franchisee succeeds.

As a franchise consultant, I've seen firsthand why some franchisees thrive while others struggle or even fail. It's a cautionary tale, but one filled with lessons that can empower you to avoid the same mistakes. The good news? The most common reasons for failure are completely within your control.

Here are the four primary reasons franchisees struggle, and what you can do to ensure you're on the path to success.

1. The Wrong Fit: Misalignment of Skills and Passion

The biggest mistake a new franchisee can make is choosing a business for the wrong reasons. It's easy to be drawn to a "sexy" concept—a food franchise because you love to cook, or a fitness franchise because you love working out. While those passions can be motivating, they don't guarantee success.

A beautiful business concept won't matter if you don't have the right skills for the job. For example, you may be an amazing executive coach, but if you can't identify and attract new clients, your business won't succeed. It's crucial to understand the day-to-day role of the franchisee. Is the job about coaching and doing, or is it about sales and business development?

The Solution: The due diligence process is your time to deeply analyze this. Don't just focus on the product or service; focus on the business model. Ask yourself honestly: "Do I have the right skills and personality for what this business truly requires?" If the answer is no, you are setting yourself up for failure.

2. Lack of Commitment: The Ownership Mindset

As a franchisee, you are a business owner. That means the buck stops with you. While the franchisor provides a structured system and support, you are ultimately responsible for the outcome of your business. Franchisees often fail when they lack the high level of commitment required to truly succeed.

When a problem arises, a franchisee with a low commitment level may try to "pawn it off" to the franchisor. This is a critical mistake. You must own your business and all its challenges. Success requires time, energy, motivation, and a willingness to prioritize the business above all else, especially in the early stages.

The Solution: Recognize that franchise ownership is about just that: ownership. You are responsible for your franchise location and the process to success. Go into the investment with a full understanding that you are the primary driver of your business and that a high level of personal commitment is non-negotiable.

3. Insufficient Time Commitment: Underestimating the Hours

When you have a job, you're used to working 40, 50, or maybe even 60 hours a week. In a franchise, you need to be prepared to invest the same amount of time, if not more, particularly when you're first starting.

One of the biggest pitfalls is underestimating the time commitment required. A franchisor or other franchisees may tell you a business can be run on a "semi-absentee basis" with only 20 hours a week. You may think, "I have 20 hours a week, so I'm good." But what if those 20 hours must be during the middle of the day, when you're at your full-time job? What if, in reality, it's more like 30-40 hours to get started?

The Solution: Calibrate your time commitment with a healthy dose of realism. During your due diligence, ask detailed questions about the hours required and when those hours are needed. Don't just ask, "How many hours?" Ask, "What time of day are those hours most critical?" If your time doesn't match the business's needs, it's not the right fit.

4. Undercapitalization: Restricting Your Growth

Undercapitalization is a silent killer for many new franchises. It's not just about having the initial investment capital of, say, $200,000. It's also about having enough money to support your personal expenses while the business gets off the ground.

When a franchisee is undercapitalized, they start making decisions based on fear, not strategy. They may pull back on crucial expenses, like spending less on marketing than they should or hiring a lower-quality team to save on payroll. These decisions will hurt the business, making it struggle even if the model is sound.

The Solution: Be realistic about your financial runway. Make sure you have enough cash flow to pay both your business expenses and your personal bills for the first 6-12 months. Being well-capitalized gives you the freedom to follow the business plan, invest in growth, and make the right decisions without being panicked by an empty bank account.

Not everyone succeeds in franchising, but the good news is that these four primary reasons for failure are entirely within your control. You can perform the right due diligence to ensure a proper fit. You can commit to the hard work required. You can make sure you have the time to dedicate to the business. And you can ensure you are well-capitalized to give your franchise the best possible start.

If you make the right decisions and partner with a leading franchise brand, you will set yourself up for a fulfilling and successful future.

Ready to start your franchise journey with a clear understanding of what it takes to succeed? Contact us for a complimentary consultation.