|
 |
|
FRANCHISE ADVANTAGES
Why Buying A Franchise Makes Good Sense When
you buy a Franchise, you're buying a "business in a box"
concept. You will be an independent business owner with no
worries about branding, product/service development,
distribution systems, training, marketing, on-going support or
equipment, if needed. Everything is provided by the Franchisor
who has a vested interest in your success. In most cases, you
don't even require any previous experience in your chosen
industry. For these reasons, it's no wonder that approximately
92% of all franchises still exist 5 years later.
|
|
|
As a Franchisee, you will no longer be
trading time for money and feeling unappreciated and
underpaid for your efforts. You will have the opportunity to
get out of your business exactly what you put into it
affording you the lifestyle you wish for yourself and your
family.
The other ways to become a business owner range from
starting up a business by yourself or buying an existing
business. Starting a business by yourself can be a very
risky and daunting task. You will have no public recognition
for your business, you'll have to develop appealing
products/services that will be in demand now and in the
future, develop a distribution system, train yourself and
possibly others, devise your own marketing plan and
advertising, have no on-going support and, if necessary,
purchase your own equipment. For these reasons, it's no
wonder that approximately 80% of all businesses fail in the
first 2 years. |
 |
|
|
|
Buying an existing business can also be a
very risky proposition. They usually cost more as you are not
only buying its physical properties and systems but you are also
paying for the existing clientele. One of the biggest challenges
is trying to find out the REAL reason the present owner is
selling his/her business. Financial records rarely tell the
entire story and it's what you don't know that can financially
ruin you. |
|
|
As a result of the lower risk factor,
buying a franchise has become THE most popular way to buy a
business today. |
|
| Franchise Advantages and Disadvantages
Snapshot: |
|
| Advantages |
Disadvantages |
| Typically easier to finance
than independent start-ups |
Dependence on Franchisor |
| Access to quality training and
on-going support |
Start up costs may be slightly
higher |
| Established concept with
reduced risk of failure |
Less control over business |
| Systematic "cookie
cutter" business approach |
Payment of franchise fee to
cover initial training, start-up support and miscellaneous
items |
| Access to lower
cost and possibly centralized buying |
On-going royalty payments in
exchange for on-going support, advertising, new product
and/or service research & development |
| Fewer start-up
problems |
Required standards, uniformity
and control regarding suppliers |
| Use of well-known trademark or
trade name (branding) |
Monitoring and
auditing of your business |
| Access to cost
effective group Advertising |
Term of agreement, possible
renewal fees, restrictions on sale of business |
| Typically, franchises
appreciate in value quicker than independent businesses |
Territory restrictions
sometimes can limit geographical growth |
| Typically provides business
site selection and better real estate negotiating power |
None |
| Able to grow into multiple
locations faster than independent start-ups |
None |
|
|
|
|
