How do I open a franchise? Before we answer this question, let’s first define what a franchise is. According to google, a franchise is “an authorization granted by a government or company to an individual or group enabling them to carry out specified commercial activities, e.g., providing a service or acting as an agent for a company’s products.”
Basically, in plain English this means that a franchise is any business that in exchange for paying a franchise fee and/or royalties, can use a proven business model with predetermined advertising materials, software, system of operations, and/or decorations, and is given a specific area on the map for their customers called a territory. Inside this territory, other franchisees of the same franchise typically cannot start another business.
When looking at a franchise, many are turned away by the price of the franchise fee and/or the royalties. Thinking, “Well, I can do that better on my own,” many instead decide to strike out on their own and lose whatever capital they have to work with.
What many don’t consider is just how huge the benefits of opening a franchise are. According to Forbes.com, 8 out of 10 entrepreneurs fail within the first 18 months. Yes, opening a Franchise can be slightly more expensive to start, but more times than not, if added up, being an individual entrepreneur can be even more expensive just from experimenting with failed methods.
With a Franchise you don’t have to keep getting it wrong until you get it right. By opening a Franchise you can get it right the first time, this reduces your risk & increases your chance of success.
When it comes to opening a franchise, many factors need to be considered including the following:
Business Model – Is it right for you?
Morals and Virtues – Do you agree with what the franchise stands for?
Lifestyle – How much time can you commit to it?
Goals – Will this franchise business accomplish your goals?
Capital – How much money do you have to put down to start a Franchise?