Starting a franchise can be a safer way to begin a small business, but it might not be right for everyone. franchisees need to follow the company’s rules and agreements. So if you prefer to run independent, opening a franchise might not suit you. If you decide to go ahead with a franchise, there are several steps you’ll need to take to get started.
Explore more Franchise Business Ideas in India.
What Is Franchising?
Franchising allow people to buy into a larger company and become the owner of one or more locations of that business. A franchisee can be one individual or a group of people purchasing a franchise together. The franchisee agrees on how to run the business with the larger company and in turn gets the right to use the company’s name, logo, reputation etc.
Generally opening a franchise involves applications, interviews, background checks and more. While this might seem like applying for job, franchisees also need the funds to support their aggreement.
Explore the List of Government Franchises.
Pro’s of Franchising
Not required experience – while having a business knowledge is important, you don’t need specific experience to buy a franchise. You are buying into a specific business and the franchiser will provide training relevant to the industry that will help you to develop the skills needed.
Similarly, another benefit of purchasing a franchise is that it lets you to explore a career in an industry you’re curious about without fully committing to starting your own business.
Existing customer base and brand awareness – People often to buy a franchise because it already has existing customer base and well-known brand, which can be tough to build for a new, small business.
With a franchise, the target audience is already set and active. since they know what to expect, they decide to do business with you faster. This means it also take less time to start making profits.
Lower risk – Buying a franchise is less risky than starting a new business, because the trial and errors phase is already done. With a franchise, you use proven strategies and follow a process that works.
Support from the franchise owner – Franchisors offer support and training to franchisees to help them understand the business model and how the stores operate. Additionally, their years of experience will help you develop business skills under their guidance, which is something you might not get if you start your own business.
Lots of opportunities to expand your business – Another benefit of buying a franchise is that you have many opportunities for growth and expansion within the same franchise.
If you succeed and like the process, you can open new locations while still getting support from the franchiser. You’ll also benefit from demand and brand awareness in all the new areas you expand to.
Explore the List of FOCO Model Franchise in India.
Cons of franchise
Limited creative opportunities – When you start your own business, you can be creative, which isn’t possible with a franchise. With a franchise, you must follow the company’s rules, so you can create your unique marketing plans or designing a new logo.
Share your financial information – Financial information is shared with the franchisor. If you want more control over your franchise, a franchise might not be the best choice comparied to running your own business. However, this can be a advantage because the franchisor can offer guidance and help with financial issues, using their experience to guide you.
Varied levels of support – Franchisors usually provide support, but it can vary. Some will help you throughout the process, while others might only give you the basics and leave you to handle things on your own.
If you’re buying a franchise to get help from an experienced leader, but they don’t provide much, support, you might have more difficulties then you excepted. Make sure to check the contract carefully and understand the level of assistance you’ll get.
Contracts aren’t permanent – When you buy a purchase a franchise, you’ll be need to sign a contract that specifies how long you’ll own the franchise. When this period ends, the franchiser might choose not to renew the contract.
For some, temporary contract can be a benefit. When the contract ends, you can use your experience with the franchise as a stepping stone to start your own business.
Conclusion – Franchise Ownership
Starting a franchise business is one of the best option, it is a lower way to start a business. Franchise business provide lots of benefits such as existing customer base, proven strategies and potential growth. For starting a franchise business it is very important to read contracts carefully.
Some popular franchise business:-
FAQs – Franchise Ownership
What are the main benefits of buying a franchise?
The main benefits of buying a franchise is a established customer’s base.
What are the disadvantage of buying a franchise?
Less creative freedom, time to time upgrade contract, share financial information.
