A successful business is hard to develop from the ground up, but there may be a shortcut if you have the investment capital and a desire for an established brand. By investing in a successful franchise, you may build a profitable business using a tested template.
What is franchising?
You probably already understand the basics of franchising in some way, as many popular national brands are franchised. Franchises are branded business models where you license a brand and business platform from a company, and the franchisor provides you with resources, a business model, and significant support. This is a strategy brands use to grow.
Why is the established business model important?
A large portion of business start-ups, regardless of initial investment, fail within the first five years or so. This is mainly because running a business is extremely difficult, and for start-ups, there is a noted lack of business infrastructure. Business infrastructure includes marketing and production standards and strategies, the look and feel of a store or office, policies for operations and personnel, marketing strategies and more. These are essential features that many new companies must figure out as they go.
In a franchise, that business plan, that infrastructure, and the knowledge of how to implement and maintain it are generally given to you directly. Franchisees open the doors of their business with much of the mystery removed.
Is franchising right for me?
This is a personal question for the owners of the business. Choosing to open a franchise is only part of the question. You must also select a franchise that will work for you. However, if you do make the leap, you will be the owner of your business, supported by the franchisor.