In case you don’t know, running a business successfully is not as simple as most people believe it to be. There are a lot of risks involved, especially at the startup stage. More so, it will demand a lot of your time, hard work, dedication, etc.
A way out of the hassles of a startup is to lean on a successful business model by buying a franchise. Suppose you are thinking, why buy a franchise? Here are some reasons why you should.
Skipping Startup Stage
The first good thing about buying a franchise is that you get to skip the startup stage, which is inarguably the most tasking and fragile part of a business. The startup stage entails conducting market research, writing business plans, creating minimum viable products, testing the products, etc. The success of a business often depends on all these factors, and not handling these factors well would mean failure.
This is perhaps the most important reason you should buy a franchise – there’s already a tested and proven system. You now have to leverage the system to run your own business.
Lower Risk Associated
As earlier seen, franchises have a proven business system based on experience and expertise. So, in buying a franchise, you’re not just buying the business but the entire business model. This will help you eliminate guesswork and avoid the common mistakes you would have made as a startup entrepreneur.
Having a proven system also means that major risks of the foundational stages of the business have been handled, and there are greater chances of success.
Purchasing a franchise license not only reduces the risk by having a proven model of business but also prepares you for events that will occur in the future.
Ideally, once you are able to find a successful franchise with a proven road map and invest in it, as long as you follow the road map the franchisor has put in place, you should be very much on your way to owning a successful franchise.
Note: Buying a franchise doesn’t equal instant and assured success. While it gives you leverage, it would still require your efforts to be successful.
A Strong Brand Image
Most franchises already have an established brand name and a customer base with brand awareness, brand recognition, and brand loyalty. This would save you the stress of building from scratch. Also, potential customers would be aware of your services even before you start.
One of the major advantages of buying a franchise is that you have the license to use the franchise’s name and logo.
Training and Support
When you buy a franchise, your franchisor will provide you with all the relevant training and tools you need to be successful. Your major staff also get trained to equip them to run the business alongside you.
Buying a franchise also provides you with the benefit of working with already existing and curated teams, such as a marketing team or a graphics design team. This will ensure that you have regular support and assistance in those areas. The franchisor can also help to publicize the launch of the new franchise. This can greatly impact the franchise in the community and the local market.
Easier Access to Finance Options
It is easier for lenders or investors to invest in a franchise than in a startup. This is because franchises already have a level of attained success. Also, when a business has chains of successful franchises, banks consider them less likely to default in repayment of loans and have higher chances of granting them loans based on this.
Some franchises can also have leasing options or provide an in-house finance system. They can also have agreements with some banks for funding options and may also offer a special discount for veterans.
Access To Increased Purchasing Power
Another major advantage of a franchise is you get easier access to the needed products sold. Traditionally, the franchisor provides the franchisee with some or all of the required products. This is especially necessary for a retail or restaurant franchise.
If the franchisor is a big business with many franchises, then there’s an advantage of increased purchasing power. In this case, the franchisor can have a centralized purchasing system where they make a bulk purchase of inventories and equipment for their franchisees. This would enable the franchisee to get their products at a significantly reduced price.
A Good Location
The franchisor may help you choose a good location where the business will thrive. Usually, they choose an area with no pre-existing franchise operations and with less competition in the local market.