For many people, purchasing a franchise seems like an excellent way to get started in business, and while a franchise can certainly be a great way to get started for many people, it’s important to consider all of the advantages and disadvantages before making a final decision to purchase a franchise.
The most obvious benefit of being part of a franchise is you have access to a selection of operating processes that have already been proven to work. These can include automated financial reporting processes, such as those provided at qvinci.com which make financial reporting far more simple for you.
The Pros For Owning a Franchise
We’ll start with the positives, and look at how spending money on a franchise can be a good way to get started in the business world.
- Processes that work
Starting up in business on your own involves a great deal of planning, and putting systems in place to make sure the business works. If you buy a franchise, all of this has already been done for you. All you have to do is follow procedures that have already been proven to work.
- Marketing in place
Successful marketing is one of the hardest things to accomplish when starting out in business. Owning a franchisee means proven marketing strategies are in place. You also have access to an audience that already recognizes the brand.
- Product price and provision
Being part of a franchise means you have access to a ready supply of products. Franchisors can buy products from wholesalers at a reduced price, as they are able to buy in bulk. This means that as a franchisee, your prices will be highly competitive with those of private businesses in the area.
- Training and support
If you buy a franchise, you will usually be offered full training by the franchisor, although you may have to pay for it. You also often get the advantage of ongoing support from an expert team. This takes away a lot of the stress you may experience when problems arise.
The cons of Owning a Franchise
It’s important to realize that owning a franchise isn’t all positive. There are some cons to owing a franchise that should be considered as well.
- Big Investment
A franchise can give you a higher level of support and security, but this comes at what can be a very high cost. Purchasing costs and legal costs involved with investing in a franchise are generally expensive.
- Complicated legal processes
Becoming a franchisee involves the reading, completing and signing of many complicated legal documents, including the franchise disclosure document. It’s important you fully understand all of these documents, and seek expert help if necessary
- Restrictions on products and creativity
If you own a franchise, you’re restricted in the products and services you can provide, and you have to follow all the rules. This can become extremely frustrating if you have good business ideas you can’t put into practice.
Whether to invest in a franchise has to be your personal decision, and it’s important to do a lot of research and really analyze your options in detail. You have to decide whether certain benefits such as training and support, proven processes and marketing outweigh the cons of additional upfront costs and restrictions on creativity going forward.