Five great reasons to choose a Franchise
Joel Caws - Technical Director, Select Your Franchise
You might have your own great ideas for starting up a business but for those who would love to start their own business and are short on ideas, a franchise can be a great business option working from an idea that’s already proven. Below we will look at 5 benefits of choosing a franchise.
1. The Franchise Formula
At the core of any franchise is its proven formula. This is mainly made up of the techniques and strategies that make the business work and that cause it to be successful. This formula also makes up the primary part of the franchise manual which is usually given to new franchisees as their business ‘bible’ to read and follow so that they can replicate the success of the original franchise pilot businesses.
2. Training & Support
Unlike starting up business for yourself, a franchise business is usually offered with a level of training and on going support. This is to enable you to run the business effectively and successfully by having a proper understanding of the franchise formula and how it is to be applied in the day-to-day activities of the business.
3. Franchise Associations
Another benefit of considering a franchise is that many countries have a Franchise Association. Generally speaking, the associations exist to promote ethical franchising in their respective countries by providing a membership scheme for franchisors. There is often a set of criteria which the franchisor must meet in order to become an approved member and this can therefore provide a level of assurance when choosing a franchise if they are an Association member. In the UK, this is the British Franchise Association and in the US it is the International Franchise Association. Additionally, the Associations may also be able to assist with any other help you might need such as pointing you in the right direction for franchise professional guidance for example legal and financial issues.
4. Proven Track Record
The good thing about a franchise is that you can often talk to other aspiring business people, just like yourself, who are already running the franchise you are considering as a business. The franchisor will usually be able to provide a list of franchisees that they are happy for you to contact as references for the franchise. It can give you extra peace of mind to meet and speak to people who have already travelled the road you are on and have already taken on and are running the franchise.
5. Financing
The majority of the high street banks have franchise sections that specialise in funding franchise business start-ups. You will still need to prepare your business plan but having the weight of a franchise system behind you can give the bank some extra assurance that you are working with an already established and proven business concept.
Finally, its worth noting that a franchise business is no guarantee of success; it provides a formula which if worked correctly, with dedication and determination, can provide the platform for a profitable business. It does, however, have some great advantages (some of which are mentioned in the points above) which can give you the edge over trying to start up a business from an unproven idea.
How to run a Franchise Business
Joel Caws - Technical Director, Select Your Franchise
From time to time, many of us have considered starting up their own business. But many of us get held back from making the leap into starting a business from our own ideas, because of the fear that we might not have the skills to make it work, or because we don’t want to be completely isolated in running a business on our own.
A franchise business can therefore represent a proven business model with training, support and back up which provides that little extra help in the challenge of starting up your own business.
So how best can you run a franchise business effectively? Well here are a few simple common-sense ways that may help you on your way:-
Good old fashioned hard work
Running any kind of business takes hard work and dedication – I have yet to hear of any solid, longstanding business that wasn’t built on the hours and hours of commitment put in by the business owner. A franchise business is no different in that sense. Having a proven system is like having a car that has been tested and proven to run and get you from one place to another. However, it won’t get you very far unless you get inside, start up the engine and drive it forward!
Stick to the proven system
A franchise works because its based on a tried and tested business model. The original business owner has spent all the time ironing out the problems and refining the business model so you don’t have to make the same mistakes. For best results, you will stick closely to the system that has been shown to work. Carrying on our car analogy, a car built specifically for normal road use doesn’t perform well if you drive it off-road onto rocky or uneven ground. In fact, it will most likely get stuck, damaged or breakdown for the simple reason you are using it in a way it was never intended to be used.
These are just two tips that can make a major difference in whether your franchise business succeeds. There are of course other factors that can make a difference but in my opinion these represent two of the largest success factors. Feel free to comment if you have any further ideas to contribute.
10 Things To Consider When Buying A Franchise
Stephen Thorns - Managing Director, Qutis Clinics
Are there really 10 things to consider? Or are they really only two or three things that are that important? I will let you make up your own mind.
What to consider or prioritise depends, on what kind of person you are. Are you high risk or low risk for example?
As a new franchisor with recent experience of recruitment, I would consider the following when buying;
- How much have I got to invest?
This is in two parts; how much of my own funds do I have and how much am I prepared to borrow? It is vital that you match the amount of funding you have with the costs of the franchises you’re considering. Every piece of research suggests that one of the main reasons for business failure is insufficient capital. My other question would be; am I prepared or able to remortgage my house and release say a further £30-£50,000? - Where are my natural skills and possibly more importantly what would I be keen to learn?
- Which franchise businesses operate in a growing market?
A rising tide lifts all boats and it is easier to grow business when the market is growing. Obviously, one needs to take account of competition but this can be a double-edged sword. The absence of competition, may suggest there is not the market that we thought. On the other hand, lots of competition may mean the market is buoyant and we could take customers from our competitors. In this latter case it is important to understand how price sensitive the market and business may be. The best way to win a price war is not to enter. - Where do I get the best return on my financial investment and time?
- What kind of customers do I want to serve?
- How well does the franchise fit with the kind of lifestyle I want?
- What is my exit plan?
- How much could I sell my business for and to whom?
- and 10. What two final points have I not listed that are important to you?
Stephen Thorns is the founder and managing director of Qutis Clinics, a new franchise model based on our success owning and operating skin care clinics in Oxfordshire since 1998.
