Ten reasons to purchase a franchise
Purchasing a franchised business is a life changing adventure. It is not a free ticket to financial freedom, yet through hard work and tenacity it more often than not can be the start of your dream life style. It is important to understand what a franchise is first.
A franchised business is a licence to be part of an already successful, accepted and branded name on the high street. Branding is one of the most difficult stages of business and in most cases takes years. You own a licence to trade under that name and in return pay a percentage to the company name holder.
Here are ten reasons why people opt for franchising:
1. Turnkey Business
Many great business people have many skills it takes to grow a successful company, but we all don’t have all the skills, and we usually shy away from one or two roles. A franchised business has all the processes in place and structured to make it easy for you.
The start up process is all taken care of location, negotiating leases,accounting, marketing, sales etc. The franchise owner has already taken the leap of faith and done the scary part of quitting their job and usually going a few years with no income in the hope of realising the dream. They probably made many mistakes on the way, so you now don’t have to, and the franchisor now can help you get straight on to where they are now.
2. Proven processes
No guesswork and expensive trial periods, because you are buying a proven system you must follow which will increase sales and overall productivity.
3. Higher Likelihood of Success
Buying a franchise is very different from starting a cottage business. Since there is an already established system in place, there is a higher likelihood of success. If you follow the system the franchisor has put in place, you will be using a system of multiplication which has worked for some of the top companies in the world.
4. Corporate Image and Brand Awareness
If you buy into a franchise system that is already established the corporate image and brand awareness is already established. Customers are more comfortable purchasing items they are familiar with, and working with companies they already know and can be relied on.
5. Easier to Obtain Financing
Financial institutions are usually very comfortable lending to the owner of a franchise business because they already have a proven track record. Bankers usually look at successful franchise chains as having a lower risk of repayment default issues and are more likely to loan money based on that premise. In addition, Many franchisors have in-house financing already in place and have negotiated a preferential rate.
Most franchise companies offer a 1-4 week in-house training program. This is what makes franchises stand out from every other business or business opportunity. The franchisor will train you to run your franchise licence exactly the same way their other successful franchise locations are run. This will ensure that you are running your business efficiently and will help to eliminate any common mistakes a new business owner usually faces.
7. Ongoing Support
When you buy a franchise you are never alone. You will always have the support of the franchisor after all their success is based on yours. You will have constant contact and develop friendships along the way. You will also be able to mix with the other successful franchisees and share good fortune and learn what’s not working also.
Some of the more established franchise brands are household names and marketing your business will just be a case of opening the doors each morning. Other franchises will have a marketing system in place and will do their utmost to promote a new arm of their company. If you are responsible for your own marketing, most franchisors will help you with branding and negotiating good deals with suppliers.
9. Exclusive Territory
When you buy a franchise you are also buying the rights to an exclusive area in which to conduct business. Franchisors will only allow a certain amount of franchises to be opened within a certain geographical region. You will be have ownership to a certain area and no other franchises (within your franchise system) can operate within that area. Leads that come in to a National database will be given to the owners of those areas.
10. Own Multiple Locations
If your franchise is successful you will always be offered more opportunities to grow within the system. The next evolutionary step is to be the owner of a multi-unit franchise.
Franchising is not always a given golden handshake for coughing up a decent amount of cash, many do fail, yet it is probably the same people who would fail at most things, and the franchisor-franchisee relationship must work both ways and the franchisor will want to see a demonstrated track report from the franchisee candidate.
For more information on how to find a franchise or how to franchise your existing business:
contact Green Frog Consultancy.