Why buy a franchise? If you are interested in owning your own business, buying a franchise is a great option. Though not all franchise businesses are created equal, if you can purchase within a well-managed system, you can avoid a lot of the hardships faced by independent entrepreneurs who struggle through the early years. If you’re debating whether or not to go with a franchise, consider these top reasons to buy a franchise.
1. It is easier to get financing for a franchise. Franchises have a relatively high rate of success compared with new independent businesses, so banks are more likely to lend to them. In addition, the franchise system may offer in-house loans or negotiate favorable leasing arrangements.
2. You know exactly what you’re getting when you buy a franchise. In addition to your familiarity with the business or product, the FTC requires that franchisers make detailed information about the business available to franchisees. This information can include the company’s history and officers, financial audit information, and a list of other franchise owners.
3. All of the start-up work is done for you. You will not have to worry about finding your location, contractors, or vendors, and you won’t have to create company documents. While an independent business owner has to devote a great deal of time to marketing efforts, website design, HR policy and training manuals, franchise owners are free to devote their time to doing business.
4. Your brand is already familiar to your customers. Brand recognition is a great advantage of a franchise system because you will automatically gain customers who are familiar with and loyal to your product.
5. You can share your franchiser’s resources. This is one of the most appealing benefits of franchise ownership, and it can save you a considerable amount of money. These shared resources might include a customer service call center, a website/online ordering system, and national advertising funds.
6. A Franchise purchase can be the first step in expanding your business. Once you have gotten one franchise up and running, you can expand by opening more locations in different territories within your system.
7. Buying a franchise is a good investment in your future. Investing in a franchise is a way of diversifying your funds and saving money on capital gains taxes until you sell. When you’re ready to sell, you can expect to find a buyer easily. A franchise system will usually help a franchisee when it’s time to transition out of the business.
If you want to run your own business, but you don’t want to start from scratch, buying a franchise may be a sound option for you.