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The Benefits of Franchising


It’s no surprise that many people who consider managing their own business consider buying a franchise, as there are a number of advantages to joining this industry.


The main benefit of becoming a franchisee is that the business will have an established product or service. Another large benefit is the franchise’s brand. Whether it is on the local level, international level or somewhere in between, the branding of a franchise serves as an advantage before and after you invest. Before you enter into a franchise agreement, you can do research on the company and check out the success of the franchisor and its reputation before making a firm commitment. After becoming a franchisee, you can reap the rewards of a number of patrons having a pre-existing knowledge of what to expect from that brand.


Other common benefits to franchising include:

  • Access to training programs for franchisees before they open their business. Many franchisors also offer staff training and ongoing training so franchisees can benefit from new developments in the franchise’s industry.
  • Set business processes that have evolved from the franchisor’s trial-and-error. Rookie mistakes will likely have already been ironed out. This reduces the risk of failure compared to someone starting a small business on their own.
  • In some cases, the obstacles to getting financing could be lessened. Lenders take into account the franchisor's experience and reputation when deciding whether to lend money.
  • When problems arise, franchising gives the franchisee an avenue to technical support and qualified staff who can give advice.
  • Franchise systems can offer purchasing efficiencies through economies of scale. Some or all of the needed products will be offered by either the franchisor or trusted suppliers. Franchisees can often take advantage of bulk discounts as well.
  • Advertising and marketing assistance. The corporate offices of franchises often perform marketing research, which leads to better targeting and more effective ads. The pooling of resources also helps keep costs reasonable.
  • If franchisees would like to sell their business at some stage, the franchisor can help locate a new buyer (often with a fee) and assist with the necessary arrangements, as opposed to an independent business owner having to oversee every step of the process alone.

Franchising offers prospective business owners a mix of personal management responsibility under the framework of an established business model. However, the key to success with franchising is the same as with an independent operation – hard work. Success is not guaranteed simply because you are using a business plan that worked for someone else. You must work as if the business plan were you own to reach your personal business owner potential.

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