If you’re interested in becoming your own boss, you may have wondered whether it would be best to develop a startup or invest in an existing franchise. But what is a franchise, exactly?
Essentially, a franchise is when a company (franchisor) grants an individual (franchisee) the right to operate a branch of their business. This permission is granted in a specific area and with specific guidelines in place to ensure that brand consistency is maintained.
Although many entrepreneurs are drawn to the idea of starting their own independent business, there is undeniable risk involved in going it alone. Franchises, on the other hand, are a more reliable investment. While 90% of startups fail, franchises are much more likely to succeed, given that they come with built-in support, assistance, and brand recognition.
Franchises Provide Assistance
For any business to thrive, substantial support is required. Franchises are established, well-known companies that provide invaluable assistance in the early stages of your business. Although the nature of such assistance will depend on the terms of your particular franchise, many come complete with the brand, supplies, and advertising plan.
Often, franchisors also provide you with support throughout your entrepreneurial journey. Trainings, consultations, helplines, and other resources impart the franchisors’ wealth of knowledge and expertise, empowering you with the information you need to operate a successful business.
Unlike a startup company, franchises come ready-made with brand recognition. When you build a business from the ground up, it takes time to spread the word and gain trust. Potential customers or clients will not be familiar with your brand, so it will take quite a bit of convincing and patience on your part to build a business from scratch.
Franchises come with a built-in customer base. People are already well aware of your business, what products or services you provide, and what to expect.
Higher Success Rate
Owning and operating your own independent business comes with a huge risk. While there is still some uncertainty involved with opening a franchise, the overall risk is much lower than it would be with your own business. In addition to the franchisor support and brand recognition, most franchises come with lower risk than independent businesses because the business model has already been proven to work across multiple locations. As a bonus, the lower risk involved with owning a franchise can also enable you to qualify for SBA franchise loans.
Hundred Acre Consulting
Business ownership can be a very tempting concept for new entrepreneurs and veterans alike. If you’re weighing whether to strike out on your own or invest in a franchise, it’s wise to first get a professional opinion from someone who can help you make the perfect decision based on your skills and knowledge.
At Hundred Acre Consulting, we have more than 13 years of experience in franchise consulting. Our expertise and connections can guide you in the best direction for your lucrative franchise investment.
Ready to get started? To learn more about our services, contact our team today!
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