Pros & Cons of Joining a Franchise Back
Joining a franchise can be a quick way to set up your own business without starting from scratch. There are many positives but it would be unwise to embark on a long term relationship with a company without being fully aware of 'both sides of the coin'. At The Financial Management Centre we encourage anyone looking at our franchise to consider everything very carefully. It's quite possible to view each 'limitation' as an opportunity. We want the very best franchisees because we believe we offer the very best service to TFMCentre clients.
10 Advantages of being part of a Franchise team
- People who buy into a franchise have amuch higher chance of success than people who 'go it alone'.
- Products and services are well established The business model is proven and you're buying into a successful system.
- The Franchisor may already be well known across the country - TFMCentre has a number of offices run by successful franchisees, so many people have heard the name and maybe even visited the website.
- Startup support can be very helpful. Franchisors give help through training, materials, phone support and much more
- In many cases, franchisors may offer 'full training', meaning no experience in necessary. At TFMCentre we look for individuals with a track record in finance, accountancy and bookkeeping.
- Head Office support means that small franchise offices can often compete with the biggest businesses in your area.
- You'll get exclusive rights to a fixed territory - the franchisor won't sell your area to anyone else.
- Banks are more inclined to lend to businesses supported by a franchise, so obtaining finance could be easier.
- Notwithstanding support from Head Office, you'll also be able to chat to other franchisees, drawing on their experience.
- Many franchises have external suppliers - you could benefit from a well established business relationship by getting preferential rates.
8 Disadvantages of Franchising
- Start up costs can be higher than 'going it alone' as the franchise fee includes elements of training, materials, sales, market intelligence and much more. At TFMCentre, our franchise fees are amongst the lowest in the sector.
- There will be some restrictions on how you conduct business. Franchisors will require you to stick to strict branding and services - something some people find too tying.
- Over time, it's possible you will feel that the franchisor is monitoring you too much. Many people prefer this though, so it's not always a bad thing to have a helping hand.
- Franchises, like every other type of business, can go bust! TFMCentre is a solid franchise with a good client base, so unlike some competitors we are in this business for the long term.
- Actions of other franchisees could affect the overall brand reputation. The solid 'vetting' process undertaken by TFMCentre ensures that our Franchisees are all professional in every way and very good brand ambassadors.
- There can be restrictions on selling a franchise should you decide to get out. Each franchise model is different, so check it out before you take the plunge!
- You will, by virtue of on-going marketing help, support and training, be required to pay a monthly 'franchise fee'. This is usually a percentage of your turnover - you should factor this in to your business plan before signing on the dotted line.
- As a franchise exists to serve the network of members you may find that being part of the franchise restricts your ability to grow and expand, particulary into new areas. Sometimes this can be done with the help of the franchisor though (they may want to invest in the same growth areas as you, so don't let this put you off. Business changes, and the franchisor, like you, may have to move with the times.