| Many people who want to go into a business consider | | | | and tested system for operating the business and |
| whether buying a business franchise is the right choice | | | | making profits. Therefore, the probability for success is |
| for them. However, just like any other business startup, | | | | much higher due to the established support system. |
| a franchise business has its advantages and | | | | Support: Small business owners usually have very little |
| disadvantages and you need to carefully weigh all the | | | | support or business acumen for managing a business. |
| pros and cons before you take such an important | | | | Buying a franchise offers the benefit that |
| decision about your life and profession and step into a | | | | entrepreneurs do not have to start from a scratch and |
| franchise business. | | | | that they can take advantage of the available |
| Though franchising is a comparatively new business | | | | resources and established systems. |
| concept, it enjoys a greater success rate than | | | | Brand Name: The more established franchises offer |
| conventional independent businesses. In fact, for | | | | an existing market awareness & brand name to |
| first-time business owners it is the safest option to | | | | franchisees. Customers become loyal to a particular |
| choose. It offers instant brand awareness as you are | | | | franchise brand and therefore increase the business |
| associated with a recognized brand and your | | | | for franchise owners in all locations. |
| franchisor will offer you organizational and technical | | | | Lower Inventory Prices: The collective buying power |
| support, training, and a network of other franchisees | | | | of a franchise group permits lower costs while |
| and associations committed to supporting franchisees. | | | | purchasing inventory and equipment. |
| Moreover, your return on investment is much faster. | | | | Better Staff Recruitment: A franchise business with a |
| There are undeniably distinct advantages of buying a | | | | renowned name will have more recruiting pull |
| franchise business opportunity, and yet, there are | | | | compared to an unknown business enterprise. |
| several disadvantages too. Before you consider a | | | | Training and Support: Franchisors provide training |
| franchise business ask yourself some simple questions | | | | programs at new franchise outlets. They are also |
| to see if you are really suited for a franchisee | | | | involved in the promotion of the new outlets. |
| business. | | | | Experience: The experience of the franchising greatly |
| Questions You Need to Ask Yourself | | | | benefits the franchisee by helping them evade |
| Can you adhere to set rules and regulations? | | | | common mistakes and by providing them with proven |
| Franchising is all about following set rules and | | | | systems of business operation. |
| procedures which are well defined by your franchisor. | | | | Drawbacks of a Franchise Business |
| If you are a highly creative person, a franchise | | | | While there are several benefits of getting into a |
| environment will stifle you as there will be no room for | | | | franchisee business, there are many disadvantages as |
| your creativity and ideas. Franchises are built on the | | | | well. |
| concept that the consumer must have a uniform | | | | Less Freedom: Franchisees have to share all financial |
| experience no matter which location they go to. | | | | information and adhere to uniform operating |
| Therefore, the product offerings, policies, and | | | | procedures. |
| operations and the overall consumer experience need | | | | Royalty Payments: Each year franchisees have to |
| to be predefined and uniform across all franchisee | | | | make royalty payments in return for the assistance in |
| outlets. | | | | operations and advertising. |
| Are you okay with hard work? | | | | Limited resources: Some franchisers may not offer all |
| Franchising is not a get-rich-quick scheme. For most | | | | the required resources for the success of your |
| franchisees, monetary success follows only after | | | | business. Discuss the level of support with other |
| years of patience and hard work. To earn a lot of | | | | franchisees before making your decision. |
| money you will have to become a multi-unit owner, and | | | | Cost factor: Buying a high-end brand name franchise is |
| that will take you a considerable amount of time. | | | | often beyond the means of many potential buyers. |
| Are you a good manager? | | | | Broken Promises: Some franchisers may not deliver |
| How compatible are you, with the idea of managing a | | | | the kind of support that was promised earlier. |
| labour force which will largely comprise of blue-collar | | | | For many, purchasing a franchise is a better option |
| workers? Do you have the background, training, or | | | | than starting a traditional business. In the light of the |
| temperament for it? | | | | facts, one can conclude that buying a franchise option |
| If your answer to all the above questions is yes, then | | | | works best for businessmen who can work well in a |
| maybe a franchise opportunity is the right choice for | | | | team environment and have limited business and |
| you. You should now consider all the advantages and | | | | industry background. |
| disadvantages of a franchise business before you | | | | Countries with a thriving retail sector like Singapore and |
| make your decision about going into a franchisee | | | | Hong Kong provide many opportunities for Franchisee |
| business. | | | | startups. Moreover, their governments have ensured |
| Benefits of Buying a Franchise | | | | policies related to laws, regulations and taxation that |
| There are several benefits of getting into a franchisee | | | | promotes the growth of entrepreneurship and |
| business. | | | | therefore starting a new enterprise is simpler and |
| Proven system: A franchise system is an established | | | | faster in these countries. |