by Lina Martinez
You’ve had enough of the rat race. You’re sick and tired of being overworked, underpaid and underappreciated. You know that if you stay where you are, you’ll condemn yourself to a life that is miserable and resentful. No matter how high up the corporate ladder you climb, the money you make will never be adequate compensation for the freedom and autonomy that you’ve sacrificed. What you really want is to take the skills and experience that you’ve gleaned in your career, combine them with your unique creative vision and raw talents, and create a business of your very own…
But that’s much more easily said than done.
Starting your own business from scratch is an extremely risky prospect. And no matter how sure you are of your idea, no matter how carefully you’ve costed your business plan and no matter how tirelessly you’ve carried out your market research, you can never be sure of success. The truth is that today’s consumers are increasingly fickle, and competing for their loyalty in a market dominated by big, familiar and trusted brands is a challenge that not all nascent startups can rise to.
If only there were some way to have the best of both worlds
If only you could start up a business that was 100% yours, while guaranteeing that your brand will resonate with your target market. If only you could guarantee that your brand will be trusted and familiar from day one.
Franchising allows you to do exactly that! Here we’ll look at some of the benefits of starting up a franchise as opposed to a conventional startup.
Wherever your strengths, skills and passion lie, there’s a franchise for you!
The great thing about operating a franchised business is that there are so many to choose from. No matter where your skills, experience, expertise and passions lie, there’s a franchise for you. Whether you’re looking to start up a fast food restaurant, a convenience store or find a pest control business for sale, there’s a franchise out there just waiting to welcome you on board. What’s more, you’ll be able to do your own research, assess the viability of the brand and ensure that you’ll be able to start turning a profit as quickly as possible.
Massively reduced startup costs
No matter how amazing your idea for a business may be, it can be extremely difficult to find funding for your startup. Particularly in the post-financial crisis era, where still (over a decade later) banks and other major institutions can be incredibly gun shy when it comes to business lending.
What’s more, even when you are able to secure startup funding, you may find that the repayments and interest place a stranglehold on your cash flow and make it difficult to turn a profit (more on that later).
Buying a franchise, on the other hand, costs a fraction of what you might expect to pay to get a new business off the ground.
All the materials, training and guidance you could possibly need
One of the scariest things about running your own business, and arguably one of the biggest reasons why 90% fail, is that when you strike out on you own you are just that… On your own. There’s nobody to hold your hand, nobody to advise on the best course of action and nobody to raise a red flag when a decision you made could have devastating repercussions for your business.
On the other hand, when you’re running a franchise you have access to all the materials you need to get off to a flying start. You’ll be given all the training, coaching and guidance you could possibly need to make a profitable start and sustain and grow that profitability as your business grows.
While a nascent startup might have access to coaching and guidance through business mentors or business angels, they may not have quite the same vested interest in your success as you can expect as a franchise owner.
Instant familiarity and brand loyalty
Remember what we said before about fickle consumers? It’s worth taking a moment to consider what makes them fickle. Do people flock to McDonald’s because they make the best hamburgers? Or to Starbucks because they represent the apex of quality coffee? Is Coca Cola the most delicious beverage ever sampled by the human palate? Of course not. But their enormous success is a testament to the power of familiarity.
In an economically uncertain era where people are working harder than ever and for longer hours than ever, consumers want to know what they’re getting for their money. Thus, most will take familiarity and reliability over quality any day of the week.
That’s not to say that when you own a franchise you don’t have to concern yourself with quality. But it does mean that you’ll have instant access to consumers who are familiar with and loyal to your brand. You don’t have to compete with major players in your chosen field to try and win their attention.
A recipe for profitability
It can take a new startup years to be able to turn a profit. Rarely can a new business be built up from nothing without incurring considerable debt. Repaying these debts (each with its own rate of interest) can put a lasting dent in your margins and make it extremely difficult to maintain a healthy cash flow. The great thing about franchises is that they’re inherently profitable.
Because startup costs are significantly reduced and there’s already a market and quantifiable interest in the brand it’s much easier for your business to become profitable.
Finally, it can provide a gateway for entrepreneurship proper
Even if your ultimate goal is to some day start your own business with its own brand from scratch, franchising can be a much better way to facilitate this than going in “cold” from a salaried job. It will provide you with valuable experience in running a business and allow you to make much better informed decisions. The operational learning curve will be far less steep and you’ll already have the strategic experience to get your new brand off to a flying start.
What’s more, if you’ve found success running a franchised business, you’ll have much more of your own capital to invest in your venture, meaning that you’ll be getting off the ground without the burden of debt that can hobble so many infant businesses.