Is Owning a Franchise a Good Financial Fit for You?
Have you ever driven by a franchised business or used a franchised service business and said to yourself, "I could see myself doing that." There's a great appeal to working for yourself, while at the same not having all the risks associated with starting a business from scratch.
But choosing a franchise that best suits you involves a number of different factors including personal desires, financial requirements, lifestyle considerations and a number of other business and personal factors.
Let's take a closer look at three main factors and what you should be considering during the decision-making process:
Do you want to duck out to coach your child's softball team? Do you want to manage a large staff or only a few employees? Maybe you don't want to have any employees at all. Do you want to be in a retail atmosphere or are you better suited to a business-to-business environment?
Some businesses can be operated from your home, while others require you to buy or rent commercial space. Home-based businesses, particularly, have seen a resurgence in recent years. In previous years, these types of franchises might have been viewed as "part-time jobs/part-time incomes," but today many home-based concepts require full-time commitments while at the same time offering significant opportunities for growth.Some people may be looking to escape a corporate job, looking to transfer their skills, or perhaps just the opportunity to spend more time outdoors and not be tied down by appointments. That's where franchises come into play. For example, many franchisees have sales and marketing skills honed from corporate positions that they simply transfer to a B2B franchise concept.
And if you want to have the opportunity to get away early some days, consider concepts that are structured to allow you the ability to add a manager to shoulder some of your responsibilities. If you're a one-person show, getting away early on some days is easier said than done.
Considerations include the initial franchise fee and ongoing royalties. In addition, franchisors may require you to contribute to national advertising programs or you may have to purchase inventory exclusively from the franchisor.
If you're wondering about your potential income, every franchisor in the United States is required to provide prospective franchisees with a disclosure document called the Uniform Franchise Offering Circular (UFOC). You can use information in this document to help you estimate earnings.
Doing your homework is essential. Realistic expectations are crucial if one is to succeed.
Another growth area in franchising today is the increasing popularity of multi-unit development. For some entrepreneurs, the goal of owning a single franchise location has been replaced by the opening of multiple units in a market. Many franchisees are choosing this route to expand their systems and increase profits quickly. But whatever your goal, there is a franchise system to fit your needs and aspirations.
We live in a 24-hour world today and if you crave that excitement, there's a franchise model to fit your need. Many concepts today offer 24/7 services to customers, giving franchise owners some creative options to fashion their workweek. But if you're a corporate warrior who has been traversing the country and burning the midnight oil, other concepts can limit your workweek to 9-to-5, Monday through Friday.
It's important to pick a franchise based on what you like. If you're looking to make a drastic career switch, take the time to think it out thoroughly. You want to choose something that you're going to look forward to doing each morning.
What franchising offers individuals is the opportunity to invest in themselves and create a thriving business that can be passed on to future generations? once you do all your homework at the onset.