Why buy a franchise?Sick of working for someone else, maybe you need to buy a franchise? If you like the idea of working for yourself with low overheads, flexible hours and some support, then there are many options. All require that leap of faith that you have the personality and ability to enjoy and succeed in your choice of franchise. Whatever you do, do something you enjoy, and that you can apply yourself to in a disciplined manner. Your success will depend on how wisely you choose, evaluate, and manage the franchise business you get into. Use professionals to assist in getting this right.
There are a number of routes to owning your own business, and buying a franchise is generally less risky, and better supported than buying a business.
Buying a Franchise – here business systems have usually been trialed and proven in the market place. There is usually additional support in the way of marketing, management advice and training. While this can restrict your ability to do your own thing, it can also reduce your risk.
When buying a franchise you’ll be getting access to;(1) A franchise agreement - which allows you to use the Franchisor's business system, tools, and know-how for a particular area. You usually pay a fee for this, and in some cases an ongoing royalty also. Buying a franchise eliminates a lot of the issues that go with starting a business or fine-tuning an existing business. When you buy a franchise you are buying a complete, ready-to-go business.
(2) A proven business system – this will generally consist of marketing and management tools, the formula for doing the business, job training, and on-going product development and support. Proven systems eliminate the guesswork and errors that most business owners would normally face. All this allows you more time to get involved in the doing part of the business.
(3) An existing reputation – a strong market presence (brand), and if purchasing an existing franchise the benefits of an existing customer base, while with a new area a good reputation can help in providing credibility to assist in attracting custom. Customers are usually more comfortable purchasing from companies they already know and trust.
(4) Track record (History) – because most franchises have been built off time-proven systems you should be able to obtain good records on the average length of time to reach break-even, your likely return on investment, expenses, hours, and skills required to succeed.
(5) Training and support – As a new franchise owner you will get training and advice in how to run and manage the business. When you buy a franchise you are never alone. You will have the support of the franchisor knowing you can pick up the phone and ask questions of the franchisor or even of other franchisees. Many franchisors also assist with the marketing of the franchise helping you pull new business in. This will be detailed in the agreement.
(6) Easier to finance – Banks are usually more comfortable in financing the purchase of a franchise because of their proven track record and lower risk involved. Larger franchise operators in some cases have relationships with banks where their franchise is preapproved, making it easier for the franchise buyers to obtain business finance.
Before you buy a franchise make sure you are doing something that works for you, and that you will enjoy doing. While buying a franchise is considered to be a lower risk option, like any business it is no guarantee for success. When purchasing any franchise always seek professional advice.By Richard O'Brien - aubizbuysell
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