There are many factors to consider when buying a franchise. It can be a large investment for you and your future financial security. A potential franchisee has to look “under the hood” at all aspects of the business to gain a level of confidence in the brand.
Pros of buying a franchise
Turnkey: A turnkey business is a business that includes everything you need to hit the ground running. A turnkey business has a strong business model in place with defined products or services and experienced committed management.
Support: A well-organized franchise will focus on offering support for its system to help alleviate the challenges of growing a business and act as a resource to fuel the business. Sales, marketing and operational support are a few examples of the kind of support services a franchise provides.
Brand: Whether a new franchise or an established brand name, investing in a franchise means your business will have a recognizable name which makes finding new customers easier than a small one location business. A good franchise system will ensure the brand name grows in awareness and consumer confidence through marketing, sales and public relations programs.
Cons of buying a franchise
Start-up costs: buying into a large brand name can mean expenses beyond the average small business owner. Finding an up and coming franchise involves the lower cost of entry and support not available to a sole proprietor.
Less independence: Franchisees are required to provide a full account of the franchise performance and adhere to the rules of the brand’s products or services. The deviation from the brand standards is not permitted which can be restrictive to some. Decide what works best for you.
Poor management: As with any business the franchisor may not be able to provide proper support to the system which can erode the relationship with the franchisees and ultimately cause the breakdown of the system.
Investing in a franchise is a big decision, do your homework, ask questions and make sure you are as committed as the franchisor.
