5 Benefits of Opening a Franchise
Franchising began to thrive after the passage of the “Lanham Act”. It allowed the sharing of a brand provided that the brand owner was the supreme controller of the goods and services offered. Most people have no clear picture of it despite its benefits to the economy. Franchising is the merging of two different and independent companies sharing a common brand. A franchisee uses the opportunity of the brand given by the brand owner and develops their own locally owned business.
There are many benefits that come with opening
a franchise business.
Brand
Recognition
Franchising always comes with a name that
people are familiar with. The people usually trust and are aware of the goods
and services that the brand offers. Name recognition goes a long way. Customers
will generally go to a name that they have heard of over a brand-new business.
It can be hard to get customers that recognize your brand as a new business but
franchising makes it easier for you.
Advertising
and Marketing
The owner helps in advertising and marketing
about the business. It does this through broadcasting on radio, TV and other
online platforms. Most of the implementation of marketing and advertising
strategies will be done by the franchise and just a small amount of resources
and time is required from you. The brand owner will also guide you on how to
market your own products and services. They also may give a marketing plan.
This plan may contain marketing strategies, sales forecasts, budgets, and
market analysis.
Easy
Access to Funds
The main challenge of getting a franchise is
usually its cost. Though the prices vary, they are usually huge investments.
Additionally, there are some more expenses required in the startup. The process
of getting a loan to start up a business is never a walkover. The SBA loans, for
instance, are usually recognized for its best standard in business loans.
However, they require some eligibility standards. The good news is that SBA
reserves some part of its loan specifically for franchises. This then becomes
easier for a franchisee rather than seeking for the loan under an independent
startup business.
Training
Programs
The franchise usually helps in the training of
its employees. It then shows them exactly how to do the work that it intends to
do. This will improve the quality of goods and services offered by the
franchise in all locations. This is usually very important as it determines the
success of the franchise because consistency is crucial. You will get help with
the training of new employees to make them familiar with the ongoing business
so that it stays on par with the overall brand.
Increased
Purchasing Power
The big businesses are usually highly
privileged in their influence in the market which also influences purchasing
power. Smaller newcomer businesses usually have more trouble. The brand owner
can purchase large amounts of equipment and inventory to its small brands. This
will reduce costs as the franchise will purchase valuable assets on your behalf
at a low price.
Franchising is a great opportunity to grow
financially. It is a worthy investment when done in the right way. Franchising
is an excellent opportunity because you are able to build a successful business
without the struggles that new businesses have to often undertake. Franchising
is also of great importance to the customers. They purchase with confidence
since the business is familiar. Franchising achieves the American dream of
independent business ownership.