When you have strong credit, your franchise's financial...
The timing is perfect and you are excited to begin a new venture! The capital required to start a new business has been set aside and now it is time for you to explore your options. Should you start your own business or take a look at some other options? Franchising has definitely been on your radar, but you aren’t quite sure if this is the right path is for you. Understanding how a franchise works and if it is the best option for you can be daunting and bottom line, franchising is not for everyone.
To ease your mind and find out if franchising is for you, ask yourself:
Both “intrapreneurs” and “entrepreneurs” are visionary minded and committed to the success of their business. The difference is how they get there. An “entrepreneur” has a good idea, creates a business, and takes full responsibility for its success or failure. On the other-hand, an “intrapreneur” uses someone else’s idea (like a franchise) and builds their business on the system or process provided.
If you have operated your own business in the past and are entrepreneurially minded, you may find the confines of a franchise system may be frustrating. Likewise, if you can follow and implement a system, a franchise may be a great option. “Intraprenuers” generally thrive in a franchise environment.
If time is of the essence and you have limited resources, time and are risk adverse, joining a franchise system may make sense. The start-up timeframe is likely to be reduced and studies have shown there is a much higher likelihood of success with franchised businesses’. Using the franchise model, you will also have access to the experience and support of others operating the same business.
Within any franchise system, there are times when you may not agree with all of the policies, programs, products etc. that they are required to offer. The franchisor acts within the best interest of the system and you may not have the option or choice to differ from the program offered. Be prepared to conform to the system or face penalties and frustration. Refer to the first point!
The level of control and rigidity of the franchise system will vary from brand to brand and the type of service or product being offered. Some franchisors are may be more or less flexible around roles and responsibilities of both sides. Generally speaking, the more established the brand, the more likely they are to have tighter controls and systems in place.
One of the main benefits of joining a franchise is the training and start-up process provided. Most franchisors will provide step by step guidance as you prepare to launch. Things like establishing an HST number or incorporating your entity are often part of the orientation program offered by the franchisor. In addition, the franchisor’s training program will teach you what you need to know to conduct business and begin making sales right away. Starting your own business may mean seeking additional training and support from independent external resources which can take time.
Making the decision to join a franchise system or start your own business requires careful consideration. No matter which option you chose, if you are prepared and have done your due diligence, you can approach the opportunity with confidence.