Many entrepreneurs want to open up a business but are unsure of how to run and operate one. Buying a franchise can give you the best of both worlds: getting the independence of owning a business with the operational and financial support of an experienced business.
Thinking of opening up a franchise? Here are some of the benefits of owning one.
Small Business Ownership – Big Business Network
A main reason that people love to run franchise is that it gives you the chance to run what feels like a small business – but with the network and support system of a much larger business.
Many franchisors (companies that are franchising) have an established brand and proven business model. They also help manage your advertising, social media strategy, and through scale, can offer lower prices for franchisees (those who purchase a franchise). You’ll benefit from your franchisor’s established relationships with suppliers and the collective buying power.
When you experience a problem or an unfamiliar situation, you have someone experienced that you can call for support. Often having that support network can be the difference between being on the path to success or failure.
Many franchisors will help franchisees with pre-opening assistance with helping you select your location, construction and design, and even a grand-opening program.
Billionaire Mike Ilitch, Founder of Little Caesars Pizza Chain was also the owner of the Detroit Tigers and the Detroit Red Wings. For each new grand-opening of a Little Caesars, he would send a professional athlete from either the Tigers or Red Wings. It will be very difficult to get a professional athlete for a start-up as part of your opening!
No Expertise? No Problem
A company will franchise its business when it has a proven business model. Many companies will spend years to refine its operations. They will then train others to operate their business model. This helps people who may not have experience. You have full access to the knowledge, experience, best practices, and industry secrets from the franchisor. Franchisors want their franchisees to succeed.
They will offer extensive and in-depth support and training to franchisees to educate and help them understand their company’s business model. If you want to open a senior care franchise, the franchisor will often work with you to cater their business model to fit your market, your skillset, and the experience you have. This will help shorten the learning curve by months, if not years.
Another benefit of it is clearly valuable to have knowledge of the care industry. But if you don’t have all that much expertise, it won’t mean you can’t run a franchise. In most cases, you will be able to – and you will simply pick up more knowledge as you go along. This means that you can feel much more confident in your ability to run the franchise business.
Higher Rate Of Success
Because franchises are generally the businesses that have survived and succeeded, franchises have a higher rate of success than start-up businesses. This is why it is often easier to secure financing for a franchise. Banks see franchises as a more secure investment than a new startup since they have the support of the larger, established corporation.
For more established franchises like McDonald’s, it has a proven model in all parts of the country. In essence, they have a recipe for success. As long as franchisees follow that recipe, their chance of success is significantly higher than a start-up with no history of success.
Access To Loyal Customer Base
Because of the way a franchise works as part of a larger business structure, you have access to an established marketing plan. One of the most difficult aspects of starting a new business is finding new customers.
A franchisee has an established marketing brand and plan. A benefit of franchising is that you can bypass much of the work needed to create a marketing plan. The franchisor can help with both national and local marketing.
While you have to usually pay an upfront payment and an ongoing royalty to the franchisor, you are essentially buying the rights to access an established and loyal customer base. You also have help in hiring procedures and access to a potential employee pool.
Buying an established and recognized franchise can give you an accelerated path to profitability through its proven recipe of success and by bringing in customers and prospective employees from day one!