8 Reasons to Choose Franchise Business Than Starting Your Own

When you've decided to become an entrepreneur, you're at a some kind of road junction. You're torn between starting something on your own and buying a Franchise. I know the same thing because I've been in the same situation and solved it myself.

Read the Reasons to Start a Franchise Business to get a better idea of what makes a Franchise Opportunity more interesting.

Research and Trial Run:

Someone has already put in the time, money, and effort to learn about the industry, the size of the market, the business opportunities, the pros and cons, the margins, the investments, and a lot of other things. The franchisor has put money into the first few set-up and pilot projects and seen how the business works. If you had done this on your own, it would have been a big risk because you wouldn't be able to go back on your investments. If you made the wrong choice, you would be stuck with it for life. The benefit of a Franchise business is that you can learn everything you need to know about the model from the Franchisor. If you need to, some Franchisors may even set up detailed meetings with existing Franchisee partners so that you can talk about how the business works on a daily basis and decide if it's right for you.

Learning and Change:

Over time, business models change. When the Franchisor started his first project, the business model would have changed much more than when he might be on his nth project. E.g., McDonald's is an international fast-food chain. Over the years, they went from being a small food stand to being one of the biggest food companies in the world.
After the change, their partners make more money and are happier because they now have a bigger piece of their customers' business. The main benefit here is that the franchisor will have learned a lot about what works and what doesn't by being in this business, and he or she will have changed or improved their business model to make it profitable for all of their franchise partners. If I did the same thing for you, I would always have to learn something new.

Branding And Awareness:

Imagine opening your own store, spreading the word about your brand, and waiting for customers to call, as opposed to opening a Franchise store and getting calls and customers walking in on the first day. This can happen with a Franchise brand because it has been around for a while and customers know what it is. When you choose to partner with a franchise brand, you save money on marketing costs and reach break-even faster. This is because the brand pull brings customers faster. Making your own brand sounds very exciting and brave, but it's not for the weak-hearted or those who don't have a lot of money.

Training and Developing the Expertise Skills:

The Franchise brand has been around for a long time and is ready to get your business going. Standard Operating Procedures (SOPs) for project launch, equipment installation, briefs for contractors, Branding elements, etc. are ready and can be carried out at a breakneck speed. When all SOPs are clear, Time to Market or Time to Go-Live works very well. The next step is to start running the store and getting things going.
Most franchisors give you and your staff a lot of training, and sometimes they even send trained staff to help you learn how to sell, use the CRM, do accounting, deliver products or services, and handle other business tasks. If you start your own business, you learn all of this as you go, which can make your operations less efficient at times. Using the V V Studio Franchise as an example, it has a 250-point training checklist that it goes through with all of its franchisee partners before they open for business. This lets them start making money from day one.

Marketing For Brand Development:

A cost line item is making marketing materials like a website, a mobile app, and ads for holidays like Diwali, Eid, and Christmas. But if you work with a Franchise brand, you get all of these things for free or at a very small cost. Most franchisors have their own digital marketing teams that create and run brand awareness or business development campaigns on social media for the brand. All franchise partners benefit from this. All of these are recurring investments for a small business, but for most franchisors, they are not expenses that can be charged to the business.

Sourcing The Consumables:

Every business needs raw materials or consumables to make a product or service. The franchisor is always more likely to benefit from economies of scale than a small business because of how big it is. Imagine if McDonald's bought potatoes to make finger chips and a fast food place that wasn't part of a chain bought potatoes. Who do you think would get a better deal and better product? Because the Franchisor creates economies of scale, the input costs of the business go down for the Franchise partners. Since the Franchisor is a regular buyer and buys on behalf of so many Franchise partners, the suppliers try to keep the right quality checks or they risk losing the business. A stand-alone business might not be able to get either lower prices or consistent quality.

The latest innovative aspects:

Being up-to-date in business is the same as keeping up with what the customers want. The well-known Franchisor brands are set up on the inside so that they have people who are always looking for the best practices in the global industry. If they don't do this, the teams work hard to find ways to cut costs, make more money, and fix operational problems. This structured investment is very important if the business wants to bring in new ideas.

Financing The Working Capital:

Banks are usually hesitant to give money to new businesses or people who have never run their own business before. But when a successful business model is used in more than one place, it becomes much easier to get a bank to finance the investment. In many cases, Franchisors work with lending institutions or non-bank financial companies (NBFCs) to help Franchise partners get the money they need to start their own business. Getting capital for your business lets you use your own money for things like business development and keeping customers. This gives you an edge that helps you build your business faster than if you just used your savings.

There is a price to pay for all of the above benefits. Most franchisors charge a one-time Franchise or Brand Fee and royalties that range from 8% to 15% of the business's income. But when you look at the benefits, these costs end up being a good business investment. When thinking about getting a franchise with any brand, it's always a good idea to do your research on the brand and make a decision only after you understand everything and have all your questions answered.

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