7 Undeniable Franchisee Advantages
If you are an entrepreneur seeking an opportunity to own and operate your own business, franchising offers one of the strongest and most profitable options available. Before you dismiss franchising as simply a fast-food racket, take a look at the following franchisee advantages. Practically any business can be franchised, and the franchisee advantages enjoyed are worth exploring.
Established Business Model
Franchisees (those purchasing a franchise business from a parent company) have the advantage of an established, superior business model. Franchising has been around in the United States since the 1940s, and the concept has been in operation since the Middle Ages. The bottom line is, franchising works. And after a small period of stagnancy in the 1980s, it has been on the rise ever since.
Dollar for dollar, there is less initial investment when investing in a franchise when compared to launching an independent new business. Some franchises cost just a fraction of what you would normally spend if you start from scratch. There are even digital franchising opportunities available for an initial investment of $5,000!
Ongoing Help, Training, and Support
One of the most significant franchisee advantages is the ongoing help, training, and support provided by the parent company. This varies from company to company, but parent companies typically want to ensure that their formula for success will be replicated in each of their franchisees. Therefore, they offer some level of ongoing help, training, and support to assist the franchisee achieve continuing success.
Exclusive territory in which to market your products and services is another of the major franchisee advantages. Overlapping territories affect the performance and profitability of other franchises. Effective territories are defined differently from industry to industry, but demographic and population, among other factors, are considered when determining where franchisees are placed.
Shared Marketing Efforts
Marketing studies vary when ascertaining how much companies spend for their marketing efforts. The average seems to be about 10% of the company’s gross annual profit. That can be a massive cost to a startup. Franchisees share that burden with the parent company, often shouldering less than half the cost. They are able to take advantage of ready-made parent company advertising, with only minimal costs.
The topic of innovation often arises when discussing franchisee advantages, but many are under the impression that owning a franchise stifles creativity and innovation. This patently false. The fertile soil of innovation is cultivated among most franchising businesses, and with multiple franchisees contributing to the mix, the chances of discovering new ways to capture the attention of the market is increased. Besides, the parent company usually invests much in the area of innovation, and new products and services are shared by the franchisees.
Reduced Chance of Failure
Being an entrepreneur is filled with risk. Significant reducing the risk of failure is close to the top of franchisee advantages. You are part of a thriving group of businesses, harnessed to a strong parent company with a proven business model and an established brand. The facts bear out that most new franchises succeed and prosper. Your chances of success are vastly more than your chances of failure.
Explore the Franchisee Advantages with Franchise Guardian
Investing in the right franchise can be the smartest move an entrepreneur can make. Franchise Guardian can help you explore the opportunities available and plot a course for your franchise success. Call or contact us online for more information.