As a franchise sales consultant and Business Broker one of the most frequent questions I receive from individuals who are considering becoming a business owner is why should I buy a franchise versus starting a new business from scratch.
My answer is that franchising can generally offer a number of distinct advantages to individuals who want to start and run their own business including the minimization of risk, comprehensive training & support, marketing assistance, a proven business model, and more. Overall the advantages of buying a franchise can generally offer an individual a greater chance of becoming a successful small business owner.
In my opinion the biggest advantage of buying afranchise business is that it is generally a lot less risky than starting a new business. Most studies conclude that over 90% of new businesses fail within 3 to 5 years. In comparison, U.S. Dept of Commerce studies have shown that over 92% of franchised businesses are still operating after 5 years. With an established and proven operating system already in place for to follow, franchises can generally offer you a much greater chance of establishing a successful business.
When you buy a franchise opportunity most franchisers will automatically require you to complete a comprehensive training program that can last any where from 1 to 4 weeks or more. This training is typically held at the franchisers corporate headquarters or at the actual franchise location. You will benefit greatly by being trained to operate your franchise location the same way that all other franchisees were, dramatically reducing the learning curve by directly transferring the knowledge and secrets of running a successful operation.
Providing on going support to new and established franchisees is second nature to most franchise companies. Its just common sense that franchisers will want to support you because it is in their best interests for you to succeed for a number of obvious reasons including the chance to generate more royalty fees and expanding their franchising system. So in general you can always feel comfortable that most franchisers will be available to provide support and answer any questions and concerns you may have about your franchise business.
One of the major advantages of the franchising business model and the system of multiple standardized units that it creates (that generally offer the same products and customer experience) is that it inherently helps market your franchise location with little or no effort. That is not to say that as a franchisee you should not attempt to do some of your own marketing as well. And if you do, the good news is that many franchisers are often willing and can be very effective in helping you develop marketing plans for your own local market.
A Proven Business Model:
Starting a new business model from scratch is inherently risky. When you buy a franchise you are generally buying a proven business model or concept that can be independently validated as having a track record of success. Unlike most small businesses started from scratch, a franchise business can offer the advantages of established operating systems, services, products, marketing, and brand name recognition that can save you invaluable time and money. And most importantly, these advantages can ultimately increase your chance of becoming a successful small business owner.