Could Franchising Be Right For You?
If you are a young professional and seriously thinking of starting your own business but lack the market expertise to start a new business, you should consider becoming a franchise owner.
On the other hand, if your startup is going strong and you are now thinking of expanding business to other parts of the country and your brand name alone is enough to pull in costumers, you may want to start giving out franchises.
But, the question is, what is a franchise?
Franchising is getting someone to manage your chain businesses instead of you doing it if you are the business owner.
Buying a franchise
Many young entrepreneurs are now interested in opening their own businesses because going to an office 9 to 5 is just not that appealing and the actual learning they derive from it is minimal. In such cases, it may be a good idea to put those entrepreneurial dreams to the work.
It also works if the person has no real business idea, but has the skills. It is a tried and tested formula, much safer than a start-up and if the right one is chosen, it can be profitable for years to come. There is also ample support from other franchise owners and from the franchisor. In some cases, the franchisor will set up everything from furniture and provide staff.
One of the biggest disadvantages to franchising is that it is limiting, it is not possible to implement plans and ideas that don’t go well with the franchisor. It can, however be an easy way to make a good amount of profit quickly if done right.
Becoming a franchisor
If you can find the right team to handle your growth and expansion, opening a franchise can be the easiest way to expand. Think about it, your business is taken to new markets, you only have to provide backup and support, the new team, with a person raring to go will be ready to take it on and prove themselves just opened up to you.
The first thing to do, however, will be to evaluate your business. Are you, more importantly, is your business ready to be taken on the expansion path.
As a start-up, your idea might have been appealing, but is it strong enough to sell to a larger market? How about the financial situation? Are you building a strong base with enough to fall back on in case the franchise does not grow at the expected rate? After you answer these questions, consider the following:
- Royalty rates and percentage
- Size and territory covered
- What about staffing and training?
- Duration of agreement
- Master franchisee or different owners in locations
The above mentioned pointers are but a few things that you will have to know and consider before giving out your franchises. Even a small difference can put a large dent in your income stream down the line, so make sure the franchise makes sense for you as well as the franchise owner.
Could franchising be the natural next step for your business?
Could buying a franchise help your entrepreneurial dream get off the ground?
And that’s the Dish. Until next time, Belinda.
I am Belinda Bow
I love all things marketing and I thrive on seeing a business become re-energised and flourish. I am excited about life and I adore my family.
Within these articles, you’ll find some helpful tips and some real guidance to help you make the most of your business, and gain a good understanding of all things marketing.