In this global, brand driven world, name recognition is influential in driving a business’ success. In many cases, brand recognition can make or break a business.
In this global, brand driven world, name recognition is influential in driving a business’ success. In many cases, brand recognition can make or break a business.
The franchise model offers the advantage of a known brand together with systems and processes that have helped many business owners build successful businesses.
Of course, you need to do your homework before you commit to buying into a franchise (we have written blogs on due diligence, leaving the franchise, and ongoing financial obligations for franchisees). You also need to consider whether being a franchisee is the right move for you. People often jump into a franchise without making a careful assessment of how becoming a franchisee will affect their lifestyle. If you don’t honestly assess whether you’re prepared to be a franchisee, you could be in for a big shock, after you’ve committed yourself to the franchise.
Your Knowledge and Skills: When choosing a brand to invest in and become a part of, most people are best to pick a business that compliments their existing skill set and knowledge. If you buy into a franchise without understanding the industry in which it operates, the franchisor’s assistance is not going to be enough to make up for your lack of skill and knowledge.
Time Commitment: It’s important to ensure you can dedicate the time required to make your business a success. Many franchise agreements set the business’ opening hours, which can be significant (for example, McDonalds). You will also need to be able to pick the right staff for your business and manage them well. In short, you will need to keep the doors open when the franchisor says and devote time to staff training while you’re establishing the business.
Degree of Control: Being a franchisee means you have less freedom than you would if you were running your own business. Everything from store layout to marketing and pricing are set by the franchisor, based on the franchisor’s experience and business model. While a franchise enables you to hit the ground running, the business model is inflexible. If you’re not willing to follow the franchisor’s lead, buying into a franchise is probably not the right decision for you – you’re more likely to be happier in the long term building your own brand.
If you’re looking at buying into a franchise but want to talk it over first, feel free to get in touch.
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