Starting your own business is risky. That’s a fact. But the trick to being successful is to calculate those risks as much as you possibly can. Franchising is one way of doing that. As well as reducing risk, there are several other reasons you might want to consider starting a business by the franchise route. Here are just a few:
1. It’s a ready made business.
A franchise is the extension of a business that has already succeeded and where the owner has distilled their success into a formula that can be repeated in other areas.
2. Training and support.
The franchise owner has a stake in your success, so they generally provide a generous level of training and ongoing support to back you up.
3. More likely to succeed.
Franchises often have a solid track record and a degree of existing brand recognition. That means that much of the ground work has already been done. As a result Banks may be more willing to lend money to your business too.
Consider the drawbacks
On the flip side, the cost of starting your business will be higher and you’ll have less autonomy to do your own thing. Franchisors will also have quite tight restrictions on who you can sell the franchise on to if you decide to move on.
Do your homework
There are some steps you should take beforehand when deciding the industry of your new franchise. First of all, how much the franchise will cost to buy, run and grow is an important matter. If you don’t have the funds to start up your business then chances of it lasting long are unlikely. However, don’t forget, the success rate and support are there to increase your chances of this not happening.
Secondly, does the industry genuinely interest you? Passion is key for you to enjoy what you’re actually doing and to let your business thrive. Getting involved in an industry that doesn’t excite you will effect how your treat your work. All of which will have a knock on effect on your staff, customers and profit.
You also need to ask yourself if your skills and experience are transferable into the type of franchise you’re looking at. There will be training and support, but if you already have strengths in the area then you’ll obviously get off to a much stronger start.
If you think franchising could be for you, take a look at the actionable advice and guidance from Reed Commercial. They’ve provided this useful infographic to help you think through those first steps.
Image: franchise via Shutterstock