Owning a Franchise Could Be Your Fastest Route to Business Ownership. Here's What You Need to Know to Succeed.Opening a franchise is a great option if you are interested in running your own business while minimizing the risk of starting one on your own. Let's discuss why opening a franchise might be the fastest route to business ownership and success.
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Franchises are an excellent way tostart a business. They offerentrepreneursandbusiness professionalsthe opportunity to get in on a plug-and-play business with awell-established reputation and brandalready in place. But before you shell out the tens of thousands of dollars needed to buy one, let's break down what you can expect.
What is a franchise?
Afranchiseis an existing business that grants an individual or individuals the right to conduct business with the use of theirbranding,trademarksand other identifying aspects of the business. Thefranchiseepays a royalty and often a startup fee for the right to conduct business under thefranchisor'sname and business structure. Some of the most notable franchises areMcDonald's, Starbucks, Subway and Domino's Pizza. But, not all franchises are restaurants — many well-established businesses offer non-restaurant franchise opportunities, including Ace Hardware, FastSigns and7-Eleven.
Why would you choose a franchise over starting your own business?
One of the biggestbenefits of owning and operating a franchiseis the lack of business experience that's needed. Franchisors offercompletebusinesses, meaning everything is already in place, proven to work and needs to be maintained. As a franchisee, your job is primarily to manage the business based on a proven business structure already in place, not to create and develop new procedures. The latter can be a good and bad thing. On the one hand, thefranchisor will usually train youto attain the business skills required to operate their franchise. On the other hand, you are heavily restricted from deviating from the companies' protocols and must adhere strictly to the franchisees' rules and regulations. This, however, can be appealing to inexperienced and new business owners.
Another reason to choose a franchise business over starting a new one: You own a business with an established brand. This is a huge draw for franchise owners. You don't have to worry aboutmassive marketing expensesandbrand exposure. With an established brand, you'll haveclientsand customers lining up on the day you open your doors.
Related: Considering franchise ownership? Get started now and take this quiz to find yourpersonalized list of franchisesthat match your lifestyle, interests and budget.
Related:Why Opening A Franchise Business Is Better Than Starting Your Own
What are the steps for owning a franchise?
Research:Research the franchise you are interested in owning. It should be a well-established company with an excellent reputation and solid sales record.
Cost & fees:了解特许经营成本和费用。确保哟u fully understand not only the cost to own the franchise but also the potentialprofitability.
Application:Be prepared for the application process. Proof of yourfinancial abilityto fund the deal will most likely be required. You'll also need to be ready to answer some questions about yourself, your background and why you're interested in their franchise opportunity.
The walk-through:Be ready for what some franchisors call "the walk-through." Some businesses request that you visit one of their facilities to see them in action. As the franchisee, you'll get the opportunity to see exactly what you're getting into, and as the franchisor, they get to explain firsthand what they expect from a franchisee.
Agreement and financing:In this step, all parties on board are set to becomebusiness partners, and all that's left to do is go over the franchise agreements and funding. It may be a good idea to consult an attorney to ensure you fully understand all the agreements before moving forward with the purchase.
Once you're officially granted licenses as a franchisee, you're ready to pick out a location and start your business. Most franchisors are happy to assist you with anything that will increase your chances of success.Ask questionsand take advantage of any and all training that they offer for you and your staff.
Related:To Make a Smart Franchise Purchase, Ask These 3 Contrarian Questions
Conclusion
Owning anestablished franchisemay be an easier way for some individuals to become business owners, but all business ownership comes with its share of challenges. Do your due diligence and consider hiring afranchise attorneyto explain in layman's terms the key provisions in the franchise agreements. As a franchisee, you get to own a business, but it's an established business with existing rules and regulations. It's imperative that you understand your obligations and responsibilities as a franchisee before you enter into any binding agreements.
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