Have you ever dreamed of operating your own business? It is a prospect that can be truly exhilarating, challenging and liberating for many reasons. Many people who own a business do so because it allows them an independence that just isn’t available among typical jobs. However, where certain freedoms exist, they can also come with risks. A traditional franchise may be the answer for you—and it may not. Let’s explore the pros and the cons.
Buying Into a Franchise
Jumping into a franchise can be a dream come true for those who struggle to thrive in the corporate world. The idea of making your own decisions and running the show can be an appealing possibility—especially when pursuing a personal interest or passion.
Most franchises typically offer its franchisees a structured business model that has already been successfully implemented. This option can be beneficial for those who want to run their own business but do not want to branch out too far on their own—and it offers the newly acquired business a road map to draw from moving forward.
Perhaps one of the most attractive aspects of franchising is the existing brand presence and marketing initiatives that are already drawing consumer awareness. Established brand recognition can be an invaluable asset when investments of both finances and time have already been given. Branding is also one less area to worry about when you’re starting out.
There are two sides to every story and franchising is no exception. For those who dream of being their own boss the flipside is the reality that they actually have to be the boss. Employee management can be complicated and often comes with a wide variety of headaches. Hiring, firing and training new employees on a regular basis is a continuous cycle that is typical for most franchised businesses.
Cost is also a major determining or deterring factor for those venturing into the world of franchising. Buying into a franchised business can cost upwards of $250,000, so preparation and dedication are key. Plus, there are the hefty monthly fees to consider. It can take some time to actually make a profit from your new business. In fact, for some, it can be years. A wise rule of thumb is to have a solid cash reserve in the bank for living expenses after purchasing a franchise. Moreover, having a long-term business plan in place is paramount to the success of the company. This takes planning, planning and more planning!
Due to logistics and financial burdens, the amount of time required for most new franchisees can be overwhelming at best. Healthy YOU Vending’s President and CEO, Jeff Marsh, says about traditional franchises: “You become married to the business, when in reality—you’re just buying a job.” What this means is that going the franchise route can still lead to being overwhelmed and overworked; essentially, you may still find yourself in the same situation you were at your last job, but for this one, you paid a hefty amount of money!
Oftentimes, those who buy into a franchise because they seek more freedoms will discover this to be less possible than originally planned. In addition, the pre-structured business model required by most franchises can actually restrict the ability to make choices that are independent from the parent company. This can ultimately lead to frustration and contention between the franchise and its franchisee.
To Franchise or Not?
Given the pros and cons, while a franchise may be a great choice for some, it might not be the answer for everyone. It is best to review the ups and downs for such an avenue, and what that can mean for you and the future of your company. Those who choose to embark on such a venture should plan well in advance to ensure that the intended personal and professional goals can be met by purchasing a franchised company. In some cases, other available business opportunities may be a better choice. These can be found with careful consideration and research.