If you want to be independent and have your own business, purchasing a franchise can be an attractive way to go. Franchises have numerous benefits that reduce the time and lessen the risks that are inherent when starting up a new business. Here’s how a franchise can help you overcome the hurdles of a new business.
1. Higher Probability of Success
Franchises are more than likely to be a profitable business because they have already gone through the trial and error phase to find the best systems and methods that are needed to create a business model that works
As a result, franchises represent a lower risk and have a lower failure rate compared to starting a business by yourself. Franchises have a proven track record of success that you can verify by talking with other franchise owners.
2. No Business Experience Necessary
When you start a new business by yourself, it is essential that you already have experience in your trade for business. With a franchise, you don’t have this problem. The franchisor will teach you everything you need to know about your business, how to set it up, how to attract customers, and how to manage it to make a profit.
In addition, the franchisor will likely have training programs for you and your employees and will provide continuous support as new issues occur in the future.
A franchisor will help you locate the best site and show you how to negotiate leases. In addition, a franchisor will help you during construction and suggest financing alternatives.
3. Business Management
After your new franchise business is up and running, you’ll need to know how to manage the operations. The franchisor will show you how to set up your accounting systems, how to construct a profit and loss statement and balance sheet, and specify which reports you need to receive to monitor and control your sales and expenses to make a profit.
4. Brand Recognition
Getting customers for any new business is always a challenge, but a franchise gives you a head start. More than likely, the franchise you select will already have a certain amount of brand awareness among its customers, and they will be eager to patronize your new business.
If this isn’t enough, a franchise will also provide marketing programs to attract new customers. You’ll learn how much money to spend on advertising and which media will give you the best return for your money to get the lowest new customer acquisition cost.
5. Buying Power
Vendors are typically reluctant to extend credit and offer the best prices to a new business because of a lack of history. However, a franchise could already have relationships set up with pre-approved vendors, and you will be able to receive favorable credit terms and take advantage of the bulk purchasing power of the franchise to get better prices for your materials and supplies.
6. Growth and Profits
In addition to having a higher probability of making a profit, purchasing a franchise also allows you to expand to different locations to increase your profits. If you’re successful with one franchise location, the franchisor will be happy to offer you opportunities to open other sites to expand your business empire.
