‘Franchising’ The new face of Entrepreneurship 2
Onyii Udoh is a freelance writer/speaker with a strong focus…
Franchising Pros and Cons
For the franchisee:
Pros |
Cons |
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For the franchisor
Pros |
Cons |
· Reduced Risk of starting a new business |
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Investing in a Franchise Business
To invest in a franchise, there are a few critical factors/questions for the franchisor and franchisee.
For the Franchisor: |
For the franchisee: |
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To assess whether a franchise represents a sound business opportunity, you’ll need to consider:
The franchisor will probably give you an information pack, but you shouldn’t just rely on this. Ask questions and look for evidence of their claims.
Visit other franchisees and talk to them. Ask the franchisor for a full list of past and present franchisees, not just the two most successful ones.
Take advantage of other sources of information and advice. Ask your bank – they usually have franchising specialists. And make the most of other advisers such as Business Link, your solicitor or your accountant.
Now, is owning a franchise right for you?
While all business opportunities are different and can be hard to define, the main difference is that typically, when someone pursues a business opportunity, they are unlikely to receive the same level of support, training, or guidance that a franchisee receives from their franchisor. The initial years are difficult when starting it from scratch when opening your own business. In fact, according to a study, only 1% of new businesses have a chance of survival.
So when it comes to choosing from freedom of starting your own business or sense of security when opting for a franchise business, one must make decisions accordingly.
Conclusion
Starting any business is a risk, and there is no guaranteed success. All an entrepreneur can hope to do is reduce the risk of failure through careful investigation before making a commitment to a business venture, and franchising helps.