This week and next we’re going to take a brief look at some of the pros and cons of buying a franchise. We’ll start with the pros – feel free to post comments about each of these. Next post will feature the cons and will provide us various opinions for a lively discussion.
Pros of Buying A Franchise
- Turnkey System: A franchise system is a proven system for operating the business and generating profits. If your skills are weak in sales & marketing or operations then a turnkey franchise may be best.
- Franchise Support: Small business owners often have very little support or lack a support team with business acumen. Buying a franchise offers the opportunity to share your challenges with other like-minded entrepreneurs. As franchise companies state, you’re in business for yourself, but not by yourself.
- Brand Name: The more established franchises provide a market awareness & brand name to franchisees. This can amount to great savings in customer acquisition costs and allow for more time in the operation of the business.
- Lower Inventory Prices: The collective buying power of a franchise group allows for lower costs in purchasing inventory and equipment. Independent businesses usually have less bargaining power with suppliers.
- Easier Staff Recruiting: Finding good employees is a critical success factor for many independent small business owners. A franchise business with a recognized name will have greater recruiting pull than an unknown business entity.
Source: Small Business information on About.com