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Merchandise or Service: How to Choose & Afford the Franchise for You

Let’s talk dollars and cents. Many new to franchising believe the amount they invest has a strong relationship with potential profits when they look into which franchise business to choose. Though making this connection seems natural enough, greater monetary investments do not always equal greater payoffs or benefits for franchisees.


The world of merchandise versus service franchises can be vastly different. Each franchise type falls into its own unique investment profile and features its own range of potential returns on investments. 


Merchandise franchises include a huge sector of tangible goods distributors that vary a great deal across the entire franchise industry. Some examples include pet products, hardware equipment and tools, and clothing store franchises. If you can touch it and put it in a bag for customers to take it home, it’s likely a merchandise business. Food franchises are an exception in this case which are often considered part of a category unto itself.


Merchandise or Service: How to Choose & Afford the Franchise for You

Service franchises also include a huge sector, though goods are actually services, and thus intangible. Service businesses in this sector can include tax preparation, automotive repair services, elder or senior care support, and cleaning or hygiene franchises. Providing valuable services to customers is growing in popularity with more consumers seeking ways to save time, minimize hassle, and rely on experts to provide a variety of maintenance services in everyday life.


Whether its businesses or the general public you’d like to serve, either franchise sector features compatible concepts. For example, merchandising franchises can sell direct to the general public or specifically provide merchandise that supports business operations, such as franchises providing water cooler equipment or mobile accessories. Service franchises on the other hand often work particularly well with business to business support and a number of opportunities exist therein.


Navigate the remarkable number of viable franchise opportunities intelligently. Consider some of these ideas for research and investment strategies:


- Take the reputation and experience of prospective franchises seriously. Tried and true franchises that have faced hard times and still live on often benefit from having faced some sort of misstep. Turning these challenges into ongoing success is what enduring trials in business is all about.


- Seek out opportunities to conduct your business in large metro areas where populations are on the rise. This will give your business every worthwhile chance of succeeding amidst a vibrant community setting.


- Consider what options are available to pay for your franchise business goals by liquidating some retirement assets alongside other savings or loans. Speak to a skilled franchise consultant and perform research on professionals that specialize in creative financing options for qualified potential franchisees.

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