Many people dream of starting their own business. The hours are of course long, the employees ungrateful, the suppliers lazy, and the clients picky – and yet, almost everybody wants to be an entrepreneur. Sure, money is a big factor, is the sense of freedom. However, the most likely culprit, at least in our opinion, is the excitement. You are leading a team of people, your destiny is only within your own hands. Whether this business succeeds or not, how much money you make, it all comes down to you.
However, for a variety of reasons, you sometimes can’t start your own business right away. Most often it’s a lack of funds. Sometimes the market in your area is oversaturated, or bloated, or the initial bureaucratic logistics of the matter are too much. Know that there is still an easier way, and that one is franchising.
With franchising, you essentially buy into a commercial franchise that achieved a great deal of success in the world. You are then allowed (and you gain some assistance) to open a branch of that franchise in an agreed upon area. This allows you almost absolute control over that office, providing you with logistics, tools, advice, marketing systems… However, these are not for everyone, and below you will find some pros and cons on whether you should buy into an award-winning franchise.
Pro: You start with a marketing system in place
One of the biggest problems that need to be solved when running a business is advertising. Not only the logistics of it all, but the price, and the actual marketing content. With a franchise, things are a bit different. Namely, you will have a ready set marketing campaign already prepared for you. Let’s say you run your business in Australia, and you move to Adelaide, for example. The marketing scheme you had set up needs to be modified and changed, to a lesser or greater degree. On the other hand, with a franchise, there is probably a marketing plan already handed out to you for such circumstances.
Pro: Initial expenses are lower
Opening your own business is no easy feat. Among the many issues, money is probably number one. The initial lump sum you need to invest, licences, paperwork, permits… It all adds up. Franchising fees and initial investments tend to be lower – which of course depends both on the franchise and the line of work you are interested in.
Furthermore, because the whole point of a franchise means many more stores, shops, and/or offices have been opened before, you have a much clearer idea where to start. Certain random expenses, costs, and fees can be avoided, mitigated, or minimized when you know exactly what you’re doing. No matter how much you plan, no matter how diligent you are, when opening up your own business there is a bit of shooting in the dark, whether you like it or not.
Con: It’s not 100% yours
However, there are some cons here too. Namely, when you buy into a franchise, you do have control over the daily grind. You are in contact with suppliers and your employees, you choose how the business will operate, what kind of equipment you will get… But the fact remains that you did not build this up from scratch yourself. You get a powerful brand behind you, something that is improved by your own hard work. Buts it’s not a brand you created, just one you strengthened. For some people, they may lose the passion that made them start their own business. Still, others enjoy the actual work more. They like the franticness, the challenge of running a business, and don’t really care about other issues.
Pro: You already have a brand behind you
Keeping with our Australia example, let’s say you want to open a second branch of a successful franchise in a major Australian city like Brisbane, or Adelaide. Instead of starting from scratch, you will have the reputation and brand of that company behind you. Getting a good franchise for sale in Adelaide that the residents already know and love will serve as a huge boost. People do gravitate towards the familiar, and brands are no different.
Con: You don’t have complete control
With a franchise, you don’t really have 100% complete control over the business. Of course, at the end of the day, the success or failure of the branch you are stationed in is all yours. But there may come a time where you think that certain aspects of the business can be done a lot better, more efficiently and cleanly. Or perhaps there may be a decision made by the higher-ups with which you don’t agree with.
Pro: A franchise provides you with a safety net
Running any kind of business is stressful, no ifs, ands, or buts about it. But a franchise carries a safety net. You are not completely on your own when you run a franchise. If the market crashes, sometimes a franchise can help with a cash injection, just to get you through the hard times.
Furthermore, you gain a lot of support from a franchise. You can receive training, education, and a host of contingency plans helping with issues that other branches of the franchises must have faced.
Con: Logistics can be an issue
Now this depends greatly on the franchise itself. However, due to the number of branch offices and locations, getting into contact with the main office can be an issue. If you want to change or address a certain issue at the franchise, you may be forced to wait, schedule, and travel a lot. Of course, this depends mostly on the size of the franchise, and the quality of its organizational structure.
Investing into a franchise can be a worthy endeavour. You start with certain systems already in place, a reputation behind you, and a brand you can rely on. If you don’t mind being part of a bigger whole, if you enjoy running a team and having your success and your failure completely be dependent upon you, then buying into a franchise is the way to go.