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How do you choose between a franchise or an independent business? Both structures have pros and cons, and people open their businesses for many different reasons. Some want to be completely independent, free to do things as they see fit. For those with a wealth of experience in business and certain industries, starting an independent business might be the only way to be happy.
However, doing everything yourself can take its toll on new business owners.
If you know industry operations but have never marketed, for example, your learning curve will be steep, and the results will be slower as you teach yourself new skills. If you don’t have broad knowledge in the following areas, franchising might fit your needs and meet your income goals sooner.
Industry-specific Regulatory Controls
If you have worked in a specific industry and know the requirements and legal compliance required, this might not be of concern to you, but if you’re branching out into something new, it can be a legal life-saver. Franchisors demand compliance within their organizations; from legal requirements to the consistent delivery of services, the franchisor ensures that the operation is legal, consistent, and smooth.
Brand Marketing
One of the strongest reasons for delving into franchising is to benefit from pre-existing brand strength. As an independent business, no one has heard of you until your first day of marketing; however, when you buy a franchise, your customers are already familiar with your name, your services, and your reputation. Plus, the franchisor continues to promote your name in your region as part of your agreement. You get to focus on delivering high-quality goods and services while the franchisor’s years of brand marketing experience support your franchise’s efforts.
Expert Training
Franchisors provide training right from the start. If you are looking at a franchise, but the type of work is new, you will need supportive, expert training. Training starts long before you open your doors, too. From daily operations to big-picture management, a franchisor will provide ongoing coaching to ensure that your franchise adds to its reputation. As the owner, you will learn all aspects of running the business. That integral training is part of what makes franchises an excellent opportunity for first-time owners or those who are changing professions.
The Happy Benefit of Franchise Fees
Business expenses are no fun, but if they benefit the business. Think of them as a smart investment.
Franchisors rely on franchise fees to continue building the brand and expanding the collective success of your new franchise. With a franchise purchase, you know those fees are going to prescribed support that helps you succeed. From marketing and promotions to legal guidance to training, the fees are reinvested in the whole brand. And as we said above, that’s one of the best reasons for buying into an established franchise.
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These key benefits bring support that you won’t have in your start-up or would have to pay for and manage separately. Whether you choose an independent business or a franchise, you will still need expertise in accounting, marketing and legal issues. But a franchise agreement includes built-in support and guidance to expedite your franchise success.
Anne Daniells is a co-owner of Enterprising Solutions, a professional services firm specializing in corporate communication and financial improvement for businesses where she shares decades of corporate and entrepreneurial experience—including franchise ownership—in her writings on business culture. She has authored hundreds of articles for publications including AllBusiness.com, TweakYourBiz.com, and MSN.com. Reach out via her website for more on where corporate culture, communication, and human architecture collide.