Franchising: a kick start business concept

Franchising as a profitable business concept is being employed by more number of businesses than ever before. Today franchising can be the best available option for the entrepreneurs aspiring to attain high returns in short span of time. Find out more

By Ramanjit Kaur | May 18, 2010

Today, whether you are aspiring to expand an existing business or start afresh, or willing to introduce a new concept, franchising is just the right venture to opt for. The idea of buying the franchise offers multiple benefits. With minimum risk, less investment, constant support system, and a popular brand to work with, franchising has become one of the popular business expansion systems in the world today. This article tries to shed some light on the various reasons for considering

franchising to start a business.

With its popular brand and established marketplace, a franchisee offers the entrepreneur significant advantages over any independent business undertaking. Qualification is not a pre requisite to own a franchise. For example, you need not to be a graduate in business administration to succeed in a franchise business, as because the franchisor is there to assist you to establish your franchise business. Moreover, as a franchisee, you need not care about the sourcing of the products or developing innovative strategies from time to time. Further, taking up the franchises rather than starting a business from scratch comes with minimum risk factor maximum returns. Thus, franchising is considered as a profitable concept that continuously plows through challenges and persistently produces wealth and success.

In order to be more precise on the various reasons regarding why an aspirant should opt for franchising, here is a comparative analysis of a franchising business and an independent start up. These include:

  • An idea: ‘An idea can change your life’. Starting a business requires an idea about the kind of business one would like to do. In other words, an aspirant looking to start his own business must possess great business acumen and needs to do rigorous market research. Starting from his business lay out, selection of location, investment plans, recruiting and training staffs, marketing and promotional plans, an individual has to take care of every aspects of business establishment. On the other hand, if you opt for franchising, you need not to care about all these things. All you need to do is to choose the right opportunity that suits your pocket and has immense growth potentials.  
  • Finance: Establishing an independent business entity requires huge investment as you need to do everything on your own. No doubt, you have to spend money on various other things (mentioned above) also. But then you require less start-up capital as the franchisor has eliminated unnecessary costs in the business system. Moreover, access to economies of scale and making use of the shared resources is another advantage.  
  • Location and layout: Being an independent aspirant, you have to select the location and the layout of the store on your own. In addition, this could be a difficult task for those who do not have prior experience in running the business. However, as a franchisee you have the franchisor to help you select the right location as selecting the best layout for your franchise outlet holds great importance in the success of the business. 
  • Innovative products and their sourcing: As already discussed, that taking up a franchise business eases off the burden of creating innovative products and sourcing the material from the franchisee’s shoulders. While for an independent entrepreneur, this could be a tough exercise. For instance, in a fast foods business, the owner is involved in making and selling a tangible product and at the same time, he needs to safeguard the uniqueness of the recipe. Although, the franchisee need not worry about these things at all.
  • Staff recruitment and training: For any independent business, recruitment and the training the staff require lot of expertise and any small mistake can lead to dire consequences. Whilst the franchisee is often helped by the franchisor in recruiting and training the staff.
  • Branding and promoting the business: Unlike independent business, taking up a franchise gives you the ability to leverage off an already established brand name. Whereas,for an independent business owner, getting accepted in a competitive market can be expensive, time consuming and very difficult. The brand equity you get after buying the franchise eradicates this intricacy.

Today, popular brand and superior quality is the paramount elements customers look for while spending their hard earned money. Franchising is a more convenient option to get started with a business. In short, buying a franchise over starting an independent business is an intelligent move to gain good benefits in this fierce competition.

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