Going into business for yourself can be the most rewarding but challenging decisions you will ever make. When weighing it up there are a few options for you:
Each path has its own pro’s and con’s, the question is what works best for you?
A franchise is one shared business idea that is operated in various locations in a structured and consistent way. There is a centre franchisor who delivers proven systems and structure for you to follow; call it a guideline for success.
The Franchisor has spent a lot of time and money developing the concept, branding, website, systems, structure, technology. The Franchisor is usually made up of a team of experts in their fields who are continually refining the systems and the support to ultimately improve your experience and your journey. The mission is to deliver a recognisable brand with great brand equity and strong market share within the sector you serve.
Most business owners get into business because they love what they do. For the most part they’d rather do what they love as an operator, which often results in neglecting how they manage their business and developing systems and structures. This can lead to a failure to innovate and stay ahead of the curve. A franchise system will do the innovation for you and provide Support Officers to help keep Franchisees stay on track. A good franchise system will also help franchisees become leaders and help them “work on the business, not just in it.”
From a financial perspective, the upfront investment needed to become a franchise owner can be significantly lower than building a business from scratch. The operations of the business will be much easier with a proven system and a step by step guide of how to operate your business. Being a part of a franchise network gives you the buying power of the whole network, rather than just one single business, and therefore can often source equipment at a more cost-effective price. Becoming an operator of an established brand makes it easier to get traffic in the door and turn a profit; in most cases people already know the brand and that awareness means a lot of the job is done for you.
An independent business is free of outside control. There is the freedom to create your own brand and build a concept that is unique to you and to control every detail, large or small.
The cost of establishing your own business is usually high when you factor in items like:
Another factor here to weigh up is the time it will take to establish the concept and the brand. As an independent you have the buying power of one. This might mean that equipment is higher, marketing spend will be higher.
You won’t have the support unless you pay external consultants along the way. However you will have the final control over the product. If you’re a creative and innovative thinker and have a concept that is not already on the market, then this option might be for you.
As an independent you will have the freedom to do as you see fit and are in complete control of every decision. You will need to understand your personality to know if this is helpful or if this will provide more stress. If you struggle to work within guidelines and have a business idea rooted and have a high appetite for risk than an independent might be for you.
If you prefer stability and are willing to work within a proven system, then a franchise will work well for you; the additional buying power and brand foundation makes a franchise potentially more lucrative.
Either option does not guarantee success however according to Janine Allis ‘you are three times more likely to be successful with a franchise than you are going to be on your own.’
Take the time to plan for the future and what will work best for you and your family, be realistic about your ownership needs before choosing the right way forward and do your research.