Going into business for yourself is a life-changing decision. You’re not only changing your career, you are making a major investment. Opening a franchise business has many advantages, including increasing your chances of success and giving you a greater return on your investment.
Proven Business Model
When you plan to open a new business in your community, you never know if people will want what you’re selling. Family and friends will tell you they love your idea, but if there isn’t a demand, your business will fail. Only 50 percent of small businesses make it to the five-year mark, mostly because there wasn’t a need for their product or service. When you buy a franchise, you’re buying a proven business model. There’s already a demand for the product.
When you operate a franchise, you’re promising to live up to the brand’s standards. Consumers know what they will receive before they enter your business so it’d a safe purchasing decision. Emotion is the primary driver in buying decisions; consumers want to avoid buyer’s remorse so they choose the familiar.
Name recognition also makes it easier to sell your business when you want to retire. Prospective business owners are more likely to pay top dollar for a business with a familiar brand name over an independent business. They realize the customers are coming through the doors because of the brand’s reputation, not the owner’s standing in the community.
Opening a business is challenging when you’ve always worked for someone else. You have to find a site, learn how to price your products competitively and still earn a profit and a host of other things that you’ve never done before. The vast majority of franchisers provide formal training and assistance. They may also facilitate networking with fellow franchisees. If your franchise offers exclusive territories, your fellow franchisees are not your competition. Instead, they are people with experience running the same business as you are operating so they are an invaluable source of knowledge.
There’s a reason national brands have slick advertising campaigns; they have marketing departments devoted to researching what works and expert marketing professionals to design campaigns. Most nationwide franchise systems include the cost of marketing in your marketing fee. Since franchisers split the advertising costs among franchisees, you benefit from professional advertising campaigns at a fraction of the cost hiring an advertising agency.
You can increase your likelihood of success by buying a franchise over opening an independent business, although you still have to evaluate each franchise opportunity’s commercial potential carefully. To succeed, you also need to do what you love. The most important advantage to buying a franchise business is your ability to choose a fulfilling career.