Sometimes when people have a hard time starting up a business of their own, they opt for franchising. Franchising is a business relationship in which the owner of the business (called the franchiser) gives the independent businessperson (the franchisee) the right to use the business name, to market the product or service and to distribute such product such as goods and services. So for the aspiring franchisee, here’s a heads up as to why you should venture into a franchise business.
First, when you franchise, you don’t have to acquire such a huge capital or investment because the concept and business operations, productions are already given by the franchiser. All you have to do is to set them up – business permits, the building, the interior decoration, the products and the like. Unlike starting out your own business, a lot of costs would occur first.
When considering for a franchise, opt for a business concept that suits you and which you really, really like. Your passion and eagerness to learn would make it easier for you to cope with different trials you can encounter. You may succeed in that easily because your passions drive you to work harder.
Second, lesser risks will happen because the system working has already been “tested and proven” by the owner of the business. But it does not give you the reason to become laid back in the business. You have to work even harder to maintain the business you ventured into and to maintain the company’s good name.
Third, you already have a brand to start with. This means, you already have loyal customers to start with. If the franchiser’s company has good records over the past years, then consider yourself lucky because there’s already one customer there by the door. However, you must keep up the good image of the company, or else your customers will walk out on you.
You can already have your day’s earnings when you start the business. Remember not to “step” on your franchiser thinking you can run it better than he does. You might be causing trouble within the system of the business operations like the production. Your franchiser’s “formula” of the production has proven well for this many years – so don’t even think of ruining it. Franchisees can help, but they don’t interfere too much. Competing with the big boss will only get you into trouble. You could even hurt the company’s stance and name.
Sometimes one is tempted to make changes in the company because he or she was demanded by the public. When franchising, don’t stray from the original business model. Always maintain healthy communication with your franchiser and with other franchisees.
Before jumping in franchising a business, bear in mind these questions:
- What are the terms and conditions of your franchiser-franchisee relationship?
- What is the pay-off period of the investment?
- What is your franchiser’s expansion plan?
- What will be the relationship between you and the franchiser?
- Are other franchisees happy with the concept?