Franchising: Is it Right for You?
It’s been found that 40 cents to every dollar spent in the retail or service industry goes to businesses that are operated by a franchisee. It’s no wonder why there are over 400,000 franchised businesses nationwide. If you have a desire to be your own boss and don’t know how to start, a franchise could be a great option.
There are over 2,500 companies nationwide that offer up their business for franchising opportunities. Here, we’ll go over a few pros and cons to owning a franchised business.
1) ½ the work is over. A lot of entrepreneurs really struggle with branding and marketing their own business. That’s already done for you. They have the marketing strategy, brand awareness, and consumer loyalty.
2) A supported network of people. You are never alone when you need help. There are so many different ways to ask for help. You can reach out to the franchisers as well as other franchisees to learn their secrets to success.
3) There is less risk. Starting your own business can be tricky and there is no guarantee that your business will stand the test of time. With a franchise, you have a network of people who care about your success.
1) Fewer opportunities for creativity. You have to use their marketing materials, their suppliers, and follow their procedures when running your business. Though you are your own boss, you don’t have the same freedoms like you would with your own business.
2) You are always paying royalties. Every month you required to share 3 to 6 percent of your earnings to the franchiser. This could potentially affect your overall profit potential.
3) No guarantee of success. Like any other business, there is no promise of success. You need to be a smart and effective business owner who knows how to get the job done.
It’s always best to reach out to a legal adviser who specializes in franchise law and contracts before making any business decision.
For more information, here are a few websites you may find helpful to get the process started.