If you’re reading this article, it’s probably because you are considering business ownership to achieve your career, lifestyle, and financial goals. But have you thought about taking that one step further – becoming a franchisee? There are numerous advantages to franchise ownership over creating a business from scratch, which explains why so many people investigate franchising as a clear and more certain path to business success.
Here are six ways franchising can help you achieve your goals.
- Franchising will help you to own your own business without requiring your time and effort to create, research and test a new business idea. Time to market!
In the U.S. today there are thousands of franchised businesses. Since the whole point of franchising is to create a successful business model for the delivery of a product or service and then finding a way to duplicate the results, buying a franchise is like the Disney FASTPASS. You can go to the head of the line by buying a franchise with a tested and proven business model and, in many cases, a turnkey package for getting the business ready to open to the public.
But, that’s not all! A reputable franchise company will also provide its franchisees with the training they need to set up and operate the business. They will provide ongoing help and support, marketing materials, operations manuals, and opportunities to meet and network with fellow franchisees. Depending on the type of business, a franchisee may supply a centralized call center, customized computer programs, or field support personnel to help you achieve your goals. Being part of a strong franchise system as apposed to being an individual business owner means that you have an entire organization invested in your success. Few of us bring all areas of expertise needed to be successful in business. Franchising allows a full team in your corner, picking up the slack where you may fall short.
- Becoming a franchisee reduces your risk as a new business owner.
It’s well known that creating a business is risky. However, there is a way to reduce that risk. You can give up the total freedom associated with being an “independent owner” by become part of a group of people committed to building a brand and dominating markets using a shared, proven operating system. You don’t have to guess about the most effective way to build your business; there is a proven system to follow.
Expect lower costs as a franchisee due to group buying power.
Whether your franchise provides a service or a product, you will probably benefit from a purchasing contract procured by the franchisor that provides you with steep discounts due to the heavy volume purchased. These discounts may apply to the ingredients for a food product, the equipment to make the product, delivery vans, store fixtures, office supplies or any number of other items. Also look for steep discounts on services that each franchisee will need to utilize, such as accounting services, auto leasing programs, Google buying power, marketing agencies and more. A good franchisor can off set the cost of the royalty with product and service savings alone!
- Franchisees have the power of national brand recognition.
There’s just no substitute for great marketing. You can make the world’s best space-age sprocket but if people don’t know about it, they won’t buy it. And here’s where franchising truly shines by using a national marketing fund the franchisor is able to combine monies from the franchisees and buy superior advertising to create national brand awareness. This national marketing fund is also used to create more professional advertising that can be utilized by the individual franchisees in their local markets. Their support can cover areas of television, radio, national events, social media content, Google marketing and more.
Take back control.
One of the reasons many people choose to become business owners is because of the desire to get control of their lives. Corporate America is not as loyal as it used to be and business ownership can reduce business travel, job related stress, and the number of hours you work per week. Some candidates look for down times at certain points in the year so they can take more time off with their families or for other leisure activities. Define your lifestyle goals and your “why.” Know what you want? We can help you find it.
This is not to say that franchise ownership is a walk in the park. It does require hard work. However, unlike a job in corporate America, as your own boss you can make decisions that will allow you to enjoy the fruits of your labor. You can be a hands-on franchisee or hire a manager that could allow you to run the business remotely. Without a clock to punch, you can make time for yourself and for your family. YOU set your own priorities. Finally, when your business is successful, you can pay yourself what your worth! And you have created an asset that YOU own.
- What are your financial goals?
Speaking of finances, how does your current job help you with your financial goals? Have you had a raise lately? Is your income keeping pace with inflation? Is your effort directly reflected in your compensation? Do they care?
Many prospective franchisees have figured out that though their work efforts may be creating a significant amount of wealth for their company, they are not necessarily sharing an equitable portion of that wealth. If you choose the right business and are willing to follow the franchisor’s system and put in the necessary hard work, the rewards of your work will be all yours.
Also, think tax benefits and exit strategies. As a franchisee, you will also be able to sell the business down the road, where the gain is yours and along the way, you can use the tax structure to reduce your taxable income.
Is it all blue skies? No, franchising is not the perfect business ownership vehicle for everyone. To be successful, a franchisee must be willing to follow the franchisor’s system. If you are someone who likes to tinker with the business and make changes, you will spend too much time “fixing” instead of attracting customers. Butting heads with the franchisor will not make you a successful franchisee. Find a different avenue.
Additionally, an important part of any franchise system is that the franchisor will collect royalty payments from each franchisee in return for the training, support, and the use of the brand. Most franchisors also collect advertising fees, as mentioned above, for use in national branding and marketing efforts. If you start your own business or buy a business opportunity, you won’t be making these payments (or getting the benefits!) so this has to be part of the consideration. Understand the numbers and make sure the value is real.
Finally, before you even begin to research franchise options, it is important that you identify all your needs and motivations for looking into business ownership. Make a list of what you hope to accomplish as a franchise owner (personally and financially) and this will help you when it comes time to make your final decision for this investment. If you don’t know where you want to go, you won’t know if you’ve found it!
Success in franchising takes skill, effort, and time but if you are willing to invest these resources, your reward may be that you finally achieve the career, return, and lifestyle you’ve always dreamed of.
