Investing is the next step of financial education when you have achieved savings to meet the goals, however, the undertaking is sometimes complicated, so franchises are an option for extra profits.
According to the National Commission for the Protection and Defense of Users of Financial Services (Condusef), a franchise is a form of business for the commercialization of goods and services in which one person grants to another, for a specific period of time, the right to use a trademark or trade name in exchange for an amount of money.
The Condusef reported in its monthly magazine that according to the Mexican Franchise Association (AMF), there are more than 85 franchise deals in the country; restaurants and food and beverage businesses are the most common.
The issue of investments is not something that should be taken lightly since it is about the future and the stability of our finances.
Therefore, he recommended that before investing, four points should be analyzed: yield, which is the profit obtained by investing; the risk, which is the possibility that something may go wrong.
As well as the term, the time during which the money is kept in an investment instrument; and liquidity, which is the facility for the money invested at the time it is required.
In this way, listed the steps to follow before opening a franchise such as analyzing the profile as an investor, that is, not all people have the same risk tolerance, you must think how willing you are to face a financial loss when looking a greater gain.
In this sense, there are three types of profiles, the conservative who does not want risks although he earns less, the moderate, who seeks good returns without the high risk and the aggressive one, who seeks high returns and focuses on the long-term objective.
In this context, you should also identify the most favored franchise, and take into account that being a business owner will be dedicated most of the time.
As well as investigating the chosen company where other aspects such as seniority, reputation and that their profits are above the investment are considered, in addition to evaluating the legal aspects, reviewing the legal contract, confidentiality agreements and articles of incorporation, for which It is better to consult with a lawyer or notary.