We are often asked about the advantages of franchising, the obvious question for many when thinking about starting a business is ‘would I be better to franchise or start-up on my own?’ This is of course a very valid question and each person has different reasons for choosing their own route. However, there are some very clean-cut advantages to choosing the franchise route.
Every new venture has an element of risk, you will undoubtedly invest time and money into any new business whether it be a franchise or start-up on your own. However if we look at the statistics it has been proven that up to 9/10 new businesses will fail within three years, while 9/10 franchises will succeed. The BFA most recent figures show that the percentage of franchises profitable in 2015 was a staggering 97%
A franchise is a tried and tested model, the products, the services, the marketing, the modus operandi – all refined buy the original founders who took the risks at start-up and paid the price of early mistakes and hard-earned experience. A franchisee bypasses the refining process and jumps in at the proven success stage; no ‘proving the concept’ or market testing needed.
With so many existing companies vying for your customers, start-ups without existing reputation have very little chance of winning over customer trust in the marketplace. With franchising the brand recognition and reputation has been established at the cost of the franchisor. A franchisee should look at key websites, customer reviews, web and advertising presence to see the successes of their prospective franchisor in the areas they already operate.
Relationships with suppliers have been built and nurtured. Buying in bulk nearly always ensures best prices so your franchisor will have buying power when it comes to trade supplies and other areas such as vehicle leasing and advertising buying. Also a good credit history can enable credit/finance terms on supplies as well as a company or supplier’s best terms.
While there are stipulations within the franchise agreement, a certain outline of the what’s and wherefores, the actual business is yours to grow within these terms. Some franchisees work round the clock to build a large empire of their own, others choose to have a work life balance of their own choosing. It is important to discuss your own hopes and expectations at a meeting with a potential franchisor, establish what your desires are and if this fits with the expectations of the company.
When you work for an employer you are building their business, you do not benefit from their success, with a franchise not only will you draw a salary, you will be building capital for the future.
A franchisor should ensure you are fully proficient in all elements of the business you are taking on and support and train you as such. The Just Shutters Franchise package ensures you are fully trained and supported not only in the job of shutter measure and installation but in sales and day-to-day running of the business.
A franchise may be able to support customers in a way a small independent operator can not, for example by offering warranties, guarantees and make value added offers customers trust. For example Just Shutters products come with a lifetime guarantee, nearly all small independent suppliers offer either no guarantee or 1-3 years.
Start-up funding is notoriously difficult to obtain, however bold and brilliant your idea, without the capital to back up your plans it can remain in the ‘idea’ phase forever. With a franchise, with trading history and solid projections based on experience and evidence of a company’s existing performance, financing can be a lot easier to obtain, call us on 01202 233744 to discuss how we can help you with this.
You can ‘hit the ground running’, as the business structure is in place and a franchise launch template proven, it is a lot quicker to go from 0-60 than if you had to build the car yourself.
As part of a franchise network you will always have skills and resources to pull on as and when you need them.
One really difficult part of starting out alone is you are the boss and the pot-washer and everything in between, most of the time without having incoming funds or space to take on staff. With a franchise you will have the benefit of many back office functions. With a Just Shutters franchise we manage calendars, follow up web-generated leads, have telesales and reception staff to answer calls and make appointments. We send brochures and automatically follow these up. Our bespoke systems give you access to these functions so you can see what we are doing for you - while you are on the road making money!
When you purchase a franchise it will usually be an exclusive territory, meaning you will not be up against that brand in your area. Also when you franchise a brand with good reputation you can often rise above any other established competitors far quicker than if you started alone.
This is a very expensive part of any business, especially so when you do not have a traditional ‘shop front’, getting your name out there can be tough and most importantly costly. Where franchisees pool resources, pull together marketing pots and use tried and tested experts, you can have all the benefits of a large organisation’s marketing power, by contributing a small portion to the pot.
We all know Google is the new Yellow Pages, the ‘go to’ place for finding whatever it is you are after (and if not Google then Bing, Yahoo or Facebook). Having a great website is so important, the majority of customers will browse a website before committing to giving you their interest. A good website and the website’s visibility are key to success.
Also see our piece on benefits of franchising over going it alone.