To Franchise or Not to Franchise
Tired of working for someone else and helping them achieve
their retirement goals? Frustrated with trading your time for money and feeling
under appreciated and underpaid? Do you have a burning desire to be your own
boss, write your own paycheck, provide for your family, move into your dream
house and take the type of vacations you really would like to experience? If the
answer is yes, then congratulations!! Owning your own business may be the answer
to fulfilling your dreams providing you have the personality, skills and desire
There are two ways to begin your own business. The first option is to formulate an idea, determine if your product/service would be widely accepted by the public, find a retail storefront, train yourself, write operating manuals, register your business, hire employees, purchase your inventory, advertise and hope that your business will succeed. A very time consuming, labor intensive and risky proposition indeed! And then, accept the fact that the vast majority of start-ups fail to survive one full year.
A much easier and less risky method of starting your own business is to simply purchase a franchise model from a reputable Franchisor whose business model has been tried and proven. The idea has already been developed and proven acceptable to the public, procedures are already in place, assistance with your storefront is usually available, training is provided, inventory is supplied in most cases and advertising plans are ready for you to implement. After you've been trained your job is to simply put your training into practice and work diligently.
Franchising allows individuals to be successful without prior experience in the industry of choice. While not being able to absolutely guarantee one's success, franchising does remove most of the reasons most start-ups fail. If you select the right franchise business, secure a good location, properly fund your venture, are ready to work hard and willing to follow the Franchisor's business practices, you should have excellent odds of success.
Franchise Advantages and Disadvantages:
Typically easier to finance than start-ups. Access to quality training and ongoing support. Established concept with reduced risk of failure. Systematic "cookie cutter" business approach. Access to lower cost and possibly centralized buying. Fewer start-up problems. Use of well-known trademark or trade name. Access to cost effective group Advertising. Typically, franchises appreciate in value quicker than start-ups. Typically provides business site selection and better real estate negotiating power. Able to grow into multiple locations faster than start-ups.
Regular reporting and audits on business. Start up costs may be slightly higher. Less control over business. Payment of franchise fee to cover initial training, start-up support and miscellaneous items. Required standards and uniformity. Monitoring and auditing of your business. Term of agreement, renewal fees, restrictions on sale of business. Territory restrictions sometimes can limit geographical market. Dependence on Franchisor. Franchisor's decisions may affect the overall performance of Franchisee's business.
About the Author:
Glen Wielandt is the CEO of FranSuccess (http://www.fransuccess.com - 866-539-8789), a franchise consulting company that educates clients in buying the perfect franchise in a safe manner. He is also a business consultant that helps start-up and companies in trouble. FranSuccess also prepares Private Placement Memorandums and franchises existing businesses.