If you’re asking yourself this question, then you’ve made the decision to become a business owner. Now you need to decide which type of business you’d like to own. This isn’t an “eenie, meenie, miney, mo” situation, so be sure to consider all of the facts below.
Starting your own business can be less expensive because you have control over investment and spending decisions, but you could have more expenses along the way, such as marketing, training, and repairing mistakes made during the learning process. Franchisees pay the one-time franchise fee and ongoing royalty fees. The fees may seem to make startup costs higher, but they cover the use of the brand, support resources, and other materials needed to help you build a successful business.
Support & Resources
Would you rather play a game with the instructions, or write the instructions yourself? Franchisors provide you with a manual on how to run a business, whereas starting your own business requires you to write the manual yourself. Both have their advantages. With instructions, you can hit the ground running. Writing the instructions yourself gives you more freedom and flexibility.
Brand recognition with a franchise can be a major advantage. Many franchises have an established national presence, which can make it easier for you to get and keep customers. However, negative publicity caused by another franchisee or the franchisor could result in a hit for you.
Need a way out? Being an entrepreneur isn’t for everyone, and if it doesn’t work out you want to make the right move. There is potential to make a good profit when selling an independent business, but finding interested buyers could be difficult without an established brand and proven system. Franchises can give buyers a feeling of safety because they know what they’re going to get. With a franchise, if all else fails, there also might be an option to have the franchisor take over the store and run it until they find a buyer.