Buying a franchise is considered by many to be a shortcut to business ownership. That's because franchises have fully developed business models, tested products and services, a recognized brand, and a built-in customer base.
Franchisors have already done a lot of the leg work for you, which is why it's easier to purchase a franchise than start your own business
. Plus, according to the International Franchise Association (IFA)
, franchising has a "reduced risk of failure over an independent business."
Since you will be investing your own money, it makes sense if you're a little hesitant on whether or not it's the right decision to make. To help you decide, we have compiled a list of the top six reasons why purchasing a franchise is the best way to become your own boss.
The Top 6 Advantages of the Franchise Business Model
Our list highlights the advantages of the franchise business model over starting a brand new business. You'll realize that these reasons are all interconnected and have an influence over each other. This will help you better understand why franchises are often so successful.
- Brand RecognitionA strong brand name speaks volumes.
It communicates that standards are held high, and so are the levels of quality in the products and services that your potential customers may already be familiar with.
When your franchise has a familiar brand name, it's easier to turn leads into sales and market to an existing and established loyal customer base. Building brand loyalty with a new business takes time and money and means you will have to prove your brand's name tirelessly in the beginning.
However, an established franchise that has built a reputation of providing the best products or services means entering the market with an advantage. There's less trial and error versus if you were to start your own company.
Plus, some franchisors may have already gained the next level of brand recognition, which is brand affinity. According to Brandwatch, this is "the most valuable and enduring level of the customer relationship, as there is a connection between the brand and consumer, as well as the product and consumer."
Not all franchise opportunities have the same level of brand recognition and affinity as McDonald's or Starbucks, especially if you are looking for an affordable, low-cost franchise opportunity. However, you can still find franchises that aren't so widely recognized and can still go a long way versus a new business that has to start building its reputation from zero.
Yet, a recognized brand is more than just attracting customers. The UPS Store Franchise in their article titled "Why Brand Awareness is One of the Most Important Advantages of Franchising," mentions that a strong brand can build consumer awareness and loyalty, and attract prospective franchisees to help "increase the demand for more franchise locations, thereby increasing the value of the entire franchise system."
So just know throughout your entrepreneurial venture that it's easier to search for either a well-known franchise or one that has already started building its reputation.
- A Well-Established Business ModelDefining strategies and testing them to develop a successful business model takes time and effort if you're starting your business from scratch. However, that's not the case when you buy a franchise. Another benefit of franchising is "the independence of having small business ownership supported by the benefits of a big business network."
A large franchise corporation, or your franchisor, may provide you with their proven business practices and a network of suppliers. Some offer assistance with your strategies and operations while keeping costs low.
- Built-In Customer Base and Identified Customer SegmentsEvaluating and identifying profitable customer segments means doing market research and analysis, which takes time and resources when you're starting your own company.
When starting a brand new business, Franchise Creator states that "you are going to have to aggressively market yourself in your area so that you can let your community and potential customers know who you are, what you do, and where you are located."
But with franchising, your franchisor has already identified and done the market research to know who their target customers are. Plus, the franchise's brand recognition may also provide you with an already built-in customer base that will allow you to start seeing profits way sooner and with a lot less effort because people already know the brand you are buying into.
- Tested Products and ServicesWith a franchise, you don't have to go through the whole process of testing your product to see if there's a market for it. Even if the franchisor is trying to roll out a new product, they have systems in place to ensure whether it's worth the return on investment after conducting the initial market research, tests and final assessment.
Also, you don't have to worry about registering products and complying with the regulations that apply to your industry. The franchise takes care of all of this for you. They provide you with all the information about the products and services that you will be selling.
- Training and SupportA common phrase that's also cited by the IFA as one of the advantages of franchising is that "Owning a franchise allows you to go into business for yourself, but not by yourself." This phrase is so popular because it defines what the franchise model is all about accurately. It's a model that allows you to be your own boss with the added benefit that you will have the franchisor providing you with training and support to help you succeed.
In fact, the UPS Store Franchise's article we mentioned before remarks that the support and expertise transferred through the training you receive as a franchisee is "…among the many unbeatable advantages of franchising."
Having the franchisor backing you up and guiding you makes purchasing a franchise a business endeavor with fewer risks than creating a startup.
- Already Established, Tested, and Proven Marketing StrategiesMost franchisors provide you with a marketing plan and strategies to successfully promote your business from the get-go without having to test what works when you start your own business.
Plus, being part of a franchise system means getting access to national or regional marketing advertising and support. That's because you and your fellow franchisees have the opportunity to chip in and support the effort, which means everyone gets to enjoy the exposure of reaching new audiences at scale.
However, for an independent business to launch such a massive campaign would be costly to do on your own without financial support. As a franchisee, you can take advantage of the franchisor's set marketing strategy and focus your time on running your business and developing strong customer relationships instead.
Purchasing a franchise is much more feasible than the amount of effort and money (not to mention the risk) that it takes to try and start a new business yourself. You still have to put in the work for your franchise to succeed, but at least you won't be doing it alone. You'll be able to enjoy all the benefits that come with franchising, like brand recognition, training and support, and all the things we mentioned before.
So, now that you have gone through the six reasons why purchasing a franchise is the best way to become your own boss, we bet you are ready to check out some attractive franchise opportunities. Let us be your starting point in your journey to becoming a franchise owner.
All USA Franchises Is the Perfect Place To Start
All USA Franchises is the largest FREE franchise directory on the market, on a mission to list all 3000+ franchises in the United States in order to become the most popular destination for entrepreneurs and investors looking to invest in a franchise.
We are the perfect place to look for a profitable franchise opportunity that fits your budget and interests. You can start your franchise search here
and search by investment or industry to find the ideal franchise opportunity that works for you.
But that's not all. If you're looking for franchise resources, we provide you with an informative AUF blog
that's full of helpful articles and tips for current and potential franchisees, franchisors, investors, and entrepreneurs. You'll also find the latest franchise news and information about the franchise events
you won't want to miss.
In addition to the blog and events information, we also help you locate franchise advisors
, franchise brokers
, franchise consultants
, franchise financing
, franchise developers
, franchise lawyers
, and franchise training services
. These resources will save you time and can provide you with additional franchise help when you need it.
All the franchise options, resources, and information you need to take a solid step towards becoming your own boss by purchasing a franchise are right here in All USA Franchises.
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