Investing in a Franchise Versus Starting a Business

Apr 02, 2020 06:17 pm | Franchising

Investing in a franchiseStarting a business from scratch
You’re investing in a business that has already proven its brand and R&D.Tight margins that are dictated by the franchise brands.You can dictate the amount of capital you will put in your business.You have to do everything yourself and start from scratch.
Franchising has higher rates of success.Suppliers, locations, partners, and more are chosen by the franchise brands.You choose which clients and suppliers to work with.You can’t be certain that people will buy your product.
Their customer base already exists.High initial investment.You work on your own time and by your own rulesThere are large costs that come with research and development. 
You don’t need experience in the industry you’re going to franchise a brand in.Franchise brands have fees such as royalties and franchise fees which take away from your profits.Learning opportunities by being involved in all aspects of the business.High failure rate and risk.
Franchisors provide ongoing support to all of their franchisees.Franchising contracts aren’t permanent and can be renewed or not.You get to follow your passion.You need definitive business experience to be able to succeed.
Franchises offer pre-opening assistanceYou’re competing with other similar brands within the area.If successful, you can sell your startup for a larger profit.You’ll have duties that are beyond or experience or interest.


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