A Newbie Business Owner is always in a quest for an opportunity to grow, whether by signing a big-budget project or by expanding their business through a new setup or franchise.
Talking about the franchise, is just diving into the concept of the franchise a great business growth plan for Newbie Business Owner? Perhaps franchising has proved to be a strategy to exponentially elevate the business graphs, but does it work for all kinds of niche?
Maybe or maybe not! It’s better to take a broader view of your decision of opening a franchise, considering all its good and bad to avoid falling in any pitfalls.
Let’s have a glance at the pros and cons of franchising Business to decide whether it’s a good idea or not.
Pros of opening a business franchise
Reduced risk of failure
The first advantage of having a franchise for your Business is its high chances of success. You are owning a Business, you better know all what can help your Business work out in the market and what are the things you need to keep in mind to make things work.
By setting up a franchise, you are imitating the same strategy as you apply for your already established Business, but this time, the plan of action you have in hand is already tried and tested and has maximum chances of getting success, which thus reduces the pressure of loss and failure.
A great way of business expansion
Newbie Business owner from scratch needs real hard work, time and money to be invested to make it a success. You as a newbie Business owner have to plan some workable strategy that can prove to be beneficial to your business idea to get you some bucks after you launch it in the industry.
On the other side when you are opting for the franchise option, there is no necessity for base investment that you demand to make for its setup and fulfilling the basic needs like a source for raw materials and other working specifications.
This branch out and grow option can prove to be the best in terms of Business expansion as it requires very little effort for generating good revenue.
Helps test run your idea in different areas
The concept of a Business franchise can act as a large way to experiment with your idea all over repeatedly. Your Business idea has got sufficient attention to identifying whether it is acceptable for the people in the market.
It might also have worked well for a certain audience, but launching it all over again with a franchise will help you grab the attention of some new audience to test the idea acceptance all-over-again to decide whether the Business has the potential to earn more than what it is earning by reaching to the wider range of audience.
Increased profitability and growth speed.
Your Business is already known by the people as they have been using your service, branching out a new setup providing the same service and the customer experience can then be a little easier.
People know what you work, the trust you have built for your service from your main office can help you get considered for the new Business set out too.
It will symbolize the extension in terms of money and Business value in the market, generating a buzz about how well your Business worked in a very short span to originate from its franchise. Moreover, the double power that you get with your new setup will boost the growth speed to generate the revenue at a greater velocity.
Increased Fundraising chances
Who doesn’t like to invest in a growing Business? Most of the investors look for the Business potential before planning to invest in some new venture. Setting up a new unit for a Business that has already seen success makes them interested in investing their money. It becomes easier for a franchise newbie Business owner to convince the investor as he has some real success data from its main setup.
Here what helps you get the central benefit is you can bring up your Business signature with the money of someone else and can make a benchmark for its business to contend with any of its contemporaries.
Cons of opening a business franchise
Hitches to maintaining consistency
There are very few negatives for franchising your company, but one of them is the ability to keep the essence of the original Business idea and service. Yes, it happens in many cases that people look to like the food of a particular restaurant in an area but simply dislike the same from its other branch or franchise.
Yes, if we look at the other side of the coin, the chances of creating a negative image increase, if the newbie Business owner fails to maintain the consistency and the experience that they give to the customer that the original unit.
The bigger team, more problems
Double the unit, double the workers, and doubled would be the difficulties that you use to face with the single branch. To maintain an even workflow of your Business, you would surely need a good management team who could take care of these small details that can help you maintain a proper balance between the work and your human resources.
Growing your Business through a franchise can be a great step towards your business expansion only when you know if it’s the right choice for your business. Find the “why” and “how” before getting the last and final this decision. The better you understand the answers to these questions, the more is the probability of getting the right perspective to make some correct choices.
Hopefully, the above-mentioned pros and cons could help you convert about some real Business features to consider before diving into your first franchise unit.