Your first thoughts when it comes to being a business owner often illicit images of small business ownership, but there’s a path to entrepreneurship that a lot of interested people never even consider – franchising. Franchising, or franchises, are well-known businesses that are owned by people under the guidance of the parent company.
You pass tons of fast food and other businesses that are actually owned by people just like you, which is one of the ways people can become a business owner without doing all of the heavy lifting of starting it themselves. If you’re interested in becoming a business owner through a franchise, then check out these useful tips on how to choose the right one.
Decide on Whether to Buy a Franchise or Open Your Own Business
Your first decision should be whether you’re actually thinking of owning a franchise, or if you want to start something on your own. Both are good options, but they differ significantly. Looking at the info from Franchise.com, you can see that franchises involve less work setting things up. You’re moving into an existing business with plenty of resources and support, whereas opening a business on your own is going to require a lot more preparation. If you want more control and say, then opening your own business is the better choice, but a franchise is a more comfortable transition into ownership.
Pick What Type of Franchise You’d Like to Own
You’ll next want to consider the type of franchise you’d like to own. This is the whole point of this article, but it can be summed quickly. When choosing a franchise, you don’t need to pick something you like, but it does help. Many franchises like fast food might be things you’re unfamiliar with, but again, you’ll have the resources to learn fast. There are commercial businesses and even retail or hotel franchises you can own, so you have options. It helps to have some interest in what you’re doing or have some base knowledge of the industry of the franchise and the type of business they run if you want to pick the right franchise to own.
Consider Your Financial Situation
Buying a franchise is also a major financial commitment. There are plenty of franchises under $10K, but they’re also smaller and lesser-known, so it might take longer to recoup on investment but could feel safer if this is your first time. Naturally, the bigger the franchise and brand name (ex. McDonald’s), the more profit you can earn, so it’s going to be a bigger investment cost. Still, with the bigger investment, you have higher chances for profit and revenue returns. Buying a franchise is a major investment consideration, big or small, so it’s good to figure out if you’re able to do so as of right now.
Think About the Time Commitment of Owning a Franchise
Not only is it going to cost you money to invest in owning a franchise, but it’s also going to be a commitment and investment of your time. Running a franchise isn’t as taxing as opening up your own business, but you’re likely going to be required to invest your personal time in managing the franchise and learning the ropes, so to speak. Some franchises will require a minimum amount of time that you have to work in the business for ownership. Regardless, owning a franchise means you need to take time to learn how it operates, the rules, and hiring and managing the staff.
Choose a Franchise That Will Be Profitable
Going back to picking a franchise, some are inevitably better than others. The example of McDonald’s is an easy one because nearly everyone can recognize the golden arches, as you would recognize Subway, Starbucks, etc. Those are just food franchises, and there are far more, but it’s good to know that there is a sliding scale of what’s going to be profitable. Theoretically, any franchise run well can be profitable, but some are inherently more profitable. It’s up to you to determine how much work it would take for you to make it highly successful and how much is based on the given fact that it’s going to be profitable.
Business ownership doesn’t always entail starting things from scratch, there are still plenty of ways to own a business without having to do all of the leg work. The best example is by buying a franchise. Owning your own slice of a highly profitable brand isn’t far-fetched, but it’s good to consider some of the useful tips for choosing which franchise is right for you.