Why Franchising is Good for Your Business


franchising-businessFranchising may be a good way to make your business grow. However, just like many other businesses, franchising also has its own advantages as well as disadvantages. Before you make a decision whether to franchise or not, you should have a clear picture of the advantages as well as disadvantages of franchising. When you sell your business for franchising, it is expected that the franchisee must also achieve the success of the company it replicates. To do this, there should be adequate support that the company extends to its franchisees.


Access to Best Talent

Offering your business for franchising can enable you to find the best people to manage the business at strategic locations. Definitely, you will expect these people to work their best for the franchise to succeed. Besides, they actually own the business while you are their partner. Instead of working hard for other companies, they choose to invest and put up their own company to grow. And since they chose your business, they will try their best to grow the business.

Access to Expansion Capital

Similarly, by offering your business for franchising, you are able to expand your business without having to come up with your own money or apply for a loan from a bank for business expansion. You are able to put up a branch at other prime locations.

Minimum Growth Risk

With franchising, the risk of losing is not much. Since you are not the one who shoulders the expenses of expanding but the franchisee, you are able earn considerable profits from the franchisee’s sales. Thus, with not monetary investment on the franchise, you get to profit more with your franchise than with your other outlets wherein you were the one who shouldered the capital and other business costs.


Less Control On Franchise Owners

Your franchisee is your business partner and not a part of your work force. Thus, you do not have power over them and demand them what to do. Possibility of conflicts can also arise because of difference in views, goals as well as how to run things to achieve such goals.

Feeble Community

Managing several franchisees could prove to be difficult as everyone is entitled for incentives for their marketing strategies and efforts. Things could become more complicated.

Other Challenges

When you feel and think there is a need to devise and introduce new ideas, there is no guarantee every franchisee agrees with you and you could proceed with the plan.

Franchising does not work for everyone. This move may be effective to some business but it could not work for the others.