Jumping into the world of business is frankly scary, stressful and fraught with risks. Many entrepreneurs – even those with ample knowledge and training – fail inevitably due to external factors and internal issues with their businesses. As such, it’s not surprising that so many who may want to pursue their own ideas for business choose not to do so.
However, there is a bridge of sorts for budding entrepreneurs between working for the man and risking it all. Franchise business opportunities provide entrepreneurs with a chance to utilize an established business model and product or service to earn a profit and be their own bosses.
For the uninitiated, let’s examine how franchises actually make it easier for entrepreneurs to follow their dreams.
Lower Startup Costs
Arguably the most attractive component of any franchise deal is the fact that starting a franchise is generally cheaper at the onset than a traditional business. With well-known and successful franchise opportunities available for as little as $15,000 in some cases, entrepreneurs can save a ton of money and time when compared to negotiating for capital and saving to pursue their dreams.
Most franchise businesses are started by entrepreneurs who need between one half and two-thirds the usual amount to open a comparable business model. Given that money is the first major hurdle in becoming self-employed, franchises help reduce the barriers for entry substantially.
Protections for Franchisees and Franchisors
At the federal level – and also in many states on top of that – special laws, rules and regulations govern the behavior of franchise businesses. These protections, governed most notably by the federal Franchise Rule, exist to protect both sides of the agreement and to ensure certain conditions are met by both entities in any franchise agreement.
Most notably, franchise protections ensure that franchisees are aware of their rights and receive proper training and information prior to any agreement being made. However, it’s highly recommended that entrepreneurs consult with franchise attorneys as well in order to ensure they fully understand each aspect of the process.
The average entrepreneur pursuing their own independent dreams has many of the same uphill battles to fight as franchisees, but one notable difference is the amount of work, time and money that must be spent on marketing and brand awareness. Those who embrace a franchise model need not worry about these issues in the day-to-day role of running a business.
By operating a franchise, your business likely already has name recognition and popularity among your target audience. This means less marketing effort is required to bring people through the doors. While franchise marketing fees and royalties generally are required from franchisees to support the broader brand’s marketing efforts, you personally won’t be tasked with juggling every aspect of the process. In short, franchises often automatically market themselves – at least from the perspective of the franchise owner.
While the experience can be different than a traditional entrepreneurial endeavor, franchise opportunities in many ways make it easier for people to own their own businesses. Thanks to brand recognition, specific protections and reduced costs at the onset, entrepreneurs can avoid many of the initial difficulties of starting a business from scratch.