Most people are drawn to the idea of owning a franchise business because of its many advantages. Here are a few of them:
- There’s already a business system in place
- Formal training is included
- There’s a marketing and advertising plan to follow
- You get a detailed operating manual
- You receive business support from the franchisor
- Real estate assistance (if needed) is often included
- Branding
It’s all good.
As a matter of fact, franchising has been called one of the greatest business models ever developed. You just need to know how to use it.
The Brand
Before I get into more detail about the topic of this article, franchise brands, it’s important for you to know exactly what a brand is.
According to Whatis.com, a brand is: a product, service, or concept that is publicly distinguished from other products, services, or concepts so that it can be easily communicated and usually marketed.
Now, I can’t tell you how many people I’ve worked with over the years who have told me (rather enthusiastically) how important the "brand" part of franchising was to them.
In a nutshell, the would-be franchise business owners I’m referring to felt they would be able to enter a new market more easily because they’d be doing so with a brand-name franchise. Makes sense, right?
And while it’s true that some of today’s consumers tend to feel more comfortable spending their money with recognizable companies, it’s not always the case. Things like price, location, and customer service weigh into purchasing decisions.
One more thing: If you’re thinking about buying a franchise that targets millennials, you may be surprised to learn that they are the most brand-loyal age-group of all.
Benefits of Owning a Familiar Franchise Brand
There are several benefits to owning a well-known franchise brand. These include:
- The name is so well known that it will bring in customers immediately
- Marketing is easier because there’s no brand-building needed
- A small business loan may be a bit easier to obtain
- Landlords may be more confident about leasing space
- Serious speed to market
Drawbacks of Owning a Familiar Franchise Brand
It’s not always rainbows, butterflies and unicorns when you’re the franchisee of a well-known brand.
That’s because part of what goes into a franchise investment is you. What you bring to the table.
For instance, you could end up buying a well-known food franchise, but only end up having an average, or below average revenue business because you lacked food-service experience. In other words, you had no idea what you were in for. The extremely long hours. The high employee turnover. Etc.
Another potential drawback of owning a franchise business that has a well-known brand attached to it is potential negative publicity.
I’m referring to something that may have happened at a franchise location clear across the country from yours. Some type of event that had nothing to do with you, but ends up negatively affecting your business. It happens!
Finally, if you choose a franchise that’s super-popular brand, and has been for a period of time, you may not be able to get your 1st or even your 2nd choice of location. That’s because potentially, the best locations have already been taken.
If you decide to search for a franchise to own, while a brand is important, it’s not everything.
My recommendation: Don’t get hung-up on a brand.
Instead, look at a combination of factors as you try to find the franchise that makes the most sense for you.
The Franchise King®, Joel Libava, is a top franchise expert. He’s written over 2,000 different articles on franchise ownership and personally consults with people who are looking to buy a profitable franchise. Go here to find out how The Franchise King® can help you become your own boss.