21 benefits of owning a franchise
Investing in a franchise is one of the safest ways of owning a business and becoming your own boss. Fraser McKay lists 21 advantages of being a franchise owner.
While the UK’s fragile economy continues to throw a dark shadow over employment figures, many people are taking control of their situation by investing in the future.
Franchising is one of the most popular means to do this and, with the string of benefits that it offers; it provides many with a safer route to self-employment.
1. You are on your own, but not alone
Franchise owners enjoy the benefit of being their own boss, but have the advantage of receiving support from the franchisor and the franchise network.
2. Less risks
The business risks faced by franchise owners are reduced considerably, but always remember there are risks in any enterprise.
3. Faster launch
Franchises owners enjoy a shorter learning curve, as they will receive assistance from the franchisor, which has experience of starting new operations and locations.
4. Easier access to funds
As franchises have a 95 per cent success rate*, banks are more willing to provide funds. For example, NatWest set aside £100 million in 2011 specifically for the franchise industry.
5. Help identifying the perfect location
Franchisors will have already done their own research to find the best territories for their business opportunities.
6. A ready-made professional image
Brand recognition is one of the keys to a successful business and with a franchise, this will already be in place.
7. Learn faster and more effectively
A franchisor’s training programme will offer its franchise owners a comprehensive background in business before they launch their business.
8. A proven business plan
Franchise owners replicate a business plan that has already been operating successfully for others.
9. Avoid costly mistakes
Whatever challenges a franchise owner will face, the franchisor will already have faced them and will have the solutions.
10. Simple accounting and financial systems
Franchise owners don’t have to worry about crunching numbers to make sure taxes and costs all add up. Franchisors provide easy-to-use accounting and financial systems for their franchise owners.
11. Peer recognition
Many franchisors hold conventions and awards, where hard work is acknowledged and franchise owners can forge business relationships and friendships.
12. Easier to secure new business
By operating under an established brand, franchise owners will find it easier to get new contracts than if they had started a new business from scratch.
13. National and regional marketing
Most franchisors use a percentage of the management service fee (MSF) towards promoting their brand using national and regional advertising.
14. Lower inventory prices
The collective buying power of a franchise group can lower the cost of inventory and equipment, saving franchise owners a lot of money.
15. Research and development
Each time a new innovation is made, franchise owners will directly benefit and incorporate these improvements into their constantly evolving business.
16. Most franchises start new trends
Franchises are usually based on an original concept and inspire other businesses to follow their lead. Franchise owners reap the advantages of this success.
17. Easier staff recruiting
A franchise business with a recognised name will have greater recruiting power than an unknown business.
18. Choice of working hours
As they are their own boss, franchise owners can choose what hours they want to work. This means they can arrange their day to fit in with family or other commitments.
19. A higher success rate
Not only are 95 per cent of franchise owners successful, but they frequently also enjoy greater turnover and profit compared to non-franchised businesses.
20. A higher re-sale value
By being part of a nationally recognised brand, a franchise owner’s business will usually be worth more than an independently owned company.
21. Job satisfaction
The majority of franchise owners invest in a franchise, which they are interested in and feel passionate about. It may be hard work running a business but when it’s for a brand that you believe in it makes the effort worthwhile.
*2010 bfa/NatWest Survey