The desire to open a business is the ultimate aspiration of many. If you’ve built your education and experience to a point where you’d like to strike out on your own, you will first need to consider whether you’ll be starting a business from the ground up or starting a franchise.
Of course, some things will be the same no matter which route you choose. Owning a business requires a great deal of commitment, whether it’s a franchise or your own firm.
For many budding entrepreneurs, the idea of a franchise proves very attractive. They find several positive traits about a franchise arrangement that are very hard to duplicate in any other situation.
Proven Products & Services
Some franchises just have the perfect storm. The UPS Store was born as a stationary arm of the already-successful UPS delivery system. The store could fill in a needed gap in the overall parcel system–specifically, the lack of pickup and drop-off points like government carriers–while expanding into services like duplicating and packing the enhanced the parcel system.
Restaurants are another good example. Franchising a food establishment gives you a proven menu, sound business plan, and an existing marketing image–all of which are incredibly difficult and expensive to develop from scratch.
The option to avoid costly development processes makes franchising a faster and more reliable option.
Starting out with your own business can become very expensive in a hurry. But in a way, it’s almost more the uncertainty than the actual cost. When bill after bill piles up, it’s intimidating to think there’s no end in sight.
Franchises cut that problem out. Instead of a great abyss of incidentals that keep trickling in, franchises have set fees and known costs that can be used to develop a very realistic and reliable budget. Once you can capture your costs within a known range, it will be easier to plan and consequently finance your operation. Lenders and investors want to know your costs in a very detailed way, and when a franchisor can provide hard, proven data, your idea will look much better to them. You’ll also attract better employees because prospective workers will see your greater stability.
Pre-Built Market Research
Does your town need a sporting goods store? Or maybe, another sporting goods store? How many pairs of shoes could you sell in a year? How many people are looking for someone new to cut their hair? The near-limitless questions about market potential and saturation are overwhelming.
Franchises help you bypass that problem. The parent company either already knows your market or has the resources to educate you and themselves about it quickly. They’ll know if your idea is viable and, more importantly, if it is not.
Companies have countless metrics they can use, gleaning their own work and assimilating it with census data and many other factors to assemble a complete picture of your potential market and whether you and the franchisor can succeed in it.
Being your own boss is a wonderful thing. Entrepreneurs who want that independence while mitigating the risk that comes with it are an ideal fit for franchising. They can get a proven product or service with a proven image, made with known costs in a well-understood market. They invest their startup capital, their determination, and their hard work and make a very powerful arrangement.
If you’ve found yourself ready to check out of the 9-to-5 world and you’ve got the entrepreneurial spirit, look first at franchises. To combine two old cliches, you could say that franchising is a great way to avoid re-inventing the wheel while you build a better mousetrap.