As an entrepreneur, it is a near certainty that you have already tried a sole proprietorship. According to the SBA, over 70% of US businesses are owned and operated by a sole proprietor. You’ve been there, done that, and learned about as much as you are going to learn from that format.
Now that you are ready to step up to the next level, you have some decisions to make. Perhaps you are on the fence about franchises. The potential is enticing. But there is the low-profit margin, lack of support from the mothership, and the stigma of being the second-rate experience compared to the corporate store.
But there is another side of the franchise story to consider. No one ever said that franchising would be easy. But if there were no rewards involved, no one would want to do it. Here are 3 reasons why you will want to give franchising a closer look:
The Brand Advantage
Brands take time to build. One of the reasons to join a franchise is that you can get the instant benefit of a well-established brand. On your own, you are never going to build a brand as big as UPS. But open a UPS store franchise, and you have the instant benefit of one of the world’s most recognized brands behind your company.
UPS has been ranked #1 in the postal and business services franchise category for 25 years running. That is in large part due to the power of a worldwide brand that has remained strong and untarnished since the beginning.
That is just one example out of thousands. Perhaps you have no interest in parcel services. Perhaps you want to take on food service, or convenience shopping. A franchise gives you a chance to start out with the one thing that takes decades to build: trust. When you don’t have to climb that particular mountain, there is no limit to how far you can go.
If you run a Smily’s Clown Burger franchise, you get free advertising every time Smily’s Clown Burger advertises. Once a person’s mouth starts watering for that double-Clown-O-rama, your store is going to get a boost.
That does not mean you don’t have to advertise for your particular location. There are still radio spots, newspaper ads, billboards, and freeway exit signs that can make or break your business. But the great thing about a franchise is that even some of those local ads get subsidized by corporate. After all, it is bad for corporate if local franchises go under.
No matter what type of business you choose for your next venture, marketing is going to be a major consideration with regard to financing your next venture. Free and subsidized marketing built in is one of the primary reasons you should consider opening a franchise.
You Don’t Have to Start from Scratch
There is no way you have forgotten how hard it was to get started with your last venture. You didn’t know what would work and what would be a disaster. You had to learn as you went along, tweaking the process until you got it just right.
With a franchise, you do not have to reinvent the wheel. The International Franchise Association (IFA) lists the following advantages:
- National and regional advertising operating procedures
- Operational assistance
- Ongoing supervision and management support
- Increased spending power
- Access to bulk purchasing
At the end of the day, every advantage of owning a franchise comes down to this: You are not alone. Every challenge you run into is already a solved problem. And there is a large, well-funded corporation standing by to help you be successful.
You have already proven yourself with the most common business type in the US. If you are up for something different with reward potential that is out of this world, a brand advantage, free and subsidized advertising, and solved problems you don’t have to figure out on your own, you can hardly do better than a franchise.