It’s no surprise that many people considering opening a business of their own turn to franchising as there are a number of advantages to joining this industry.
The main benefit of becoming a franchisee is that the business will have an established product or service. In franchising, someone has already done the work of developing and establishing a viable business system. Rookie mistakes will likely have already been ironed out.
Part of that established business system is another large benefit of franchising: the brand. Whether it’s on the local level, international level or somewhere in between, the branding of a franchise can serve as an advantage before and after you invest. Familiarity can help you develop a customer base because of potential patrons through a pre-existing knowledge of what to expect from that brand.
Other common benefits to franchising include:
- Access to training programs for franchisees before they open their business. Many franchisors also offer ongoing training opportunities so franchisees can benefit from new developments in the franchise’s industry.
- In some cases, the obstacles to getting financing could be lessened. Lenders take into account the franchisor’s experience and reputation when deciding whether or not to lend money.
- When problems arise, franchising gives the franchisee an avenue to technical support and qualified staff who can give advice.
- Franchise systems can offer purchasing efficiencies through economies of scale. Some or all of the needed products will be offered by either the franchisor or trusted suppliers. Franchisees can often take advantage of bulk discounts as well.
- Advertising and marketing assistance. The corporate offices of franchises often perform marketing research, which leads to better targeting and more effective ads. The pooling of resources also helps keep costs reasonable.
- If franchisees would like to sell their business at some stage, the franchisor can help locate a new buyer (often with a fee) and assist with the necessary arrangements, as opposed to an independent business owner having to oversee every step of the process alone.
Some words of advice: Before you enter into a franchise agreement, do research on the company you’re considering becoming a part of. Check out the success of the franchisor and its reputation before making a firm commitment.
After opening, you must work just as hard as if the business plan were your own to reach your personal business owner potential. Though there are some elements that differ, the key to success with franchising is the same as with an independent business—hard work. Success is not guaranteed simply because you are using a business plan that worked for someone else.