IN today's highly competitive startup landscape, many businesses struggle before reaching their full potential. Amid this uncertainty, franchising offers entrepreneurs the best of both worlds – the excitement of owning a business without the daunting risks of starting from scratch. By tapping into an established brand's success formula and operational framework, franchisees can leap past the uncertainties that surround new ventures.
Starting a franchise is like a crash course in business ownership. All the essentials are learnt before opening the doors, from dealing with tricky customers to managing finances.
Most franchisors offer intensive initial training programs that can last weeks or even months. These programs cover the ins and outs of the business model, master proprietary software systems, and get hands-on experience in a working franchise location. Ongoing support includes regular visits from field consultants, continuous training programs, and access to a network of fellow franchisees.
In the franchise game, being a part of a brand that people know and love is a significant advantage. Brand recognition can cut years off the time it takes to establish a loyal customer base.
Franchisees benefit from national (or even international) marketing campaigns, a tried-and-tested brand image, and customer trust that has been built over the years. This instant credibility can translate into faster profitability and a smoother path to success.
Franchising provides buying power like big businesses. As part of a larger network, discounts on supplies and equipment are often available.
Money is saved on everything from everyday items to major purchases for the business. Franchisors leverage their size to negotiate better prices with suppliers, passing those savings on to the franchisees.
This can include everything from raw materials and inventory to big-ticket items like equipment and technology. Some franchisors even have their own supply chains or manufacturing facilities, further reducing costs. These economies of scale can significantly boost profit margins and give a competitive edge over independent businesses.
Franchising is all about consistency.
A set of guidelines ensures that customers have the same great experience every time. This goes beyond just offering the same products. It includes how the store looks, what employees wear, and how customers are treated.
The franchisor gives a detailed manual on how to run things, which is regularly updated with the best practices.
This helps maintain quality and simplifies operations. Many day-to-day decisions are already figured out, allowing franchisees to focus on growing their business.
Franchisors are always looking ahead, trying to spot the next big trend in the industry. They invest in research and product development, testing new ideas in their own stores before sharing them with franchisees. This keeps franchisees up to date in their industry without the time and cost of doing it all independently.
In franchising, facing business challenges is not a solitary endeavor. Being part of a larger network helps weather through tough times better than an independent business. The proven business model lowers the risk of failure compared to starting from scratch. Many franchisors offer financial help or connections to lenders for startup costs. Some even have plans for economic downturns or unexpected events. With so many franchisees out there, most problems likely have been solved before. This shared knowledge and support can be incredibly valuable when navigating the ups and downs of owning a business.
Franchising is not just a business model; it is a revolution in how entrepreneurship is approached. It combines the excitement of a new business with the experience of an established one. Franchisees get the energy and passion of starting something fresh, plus the practical knowledge from a company that has already worked out the kinks. It is like having the best of both worlds – the thrill of being one’s own boss, backed by proven methods that work. For those looking to dip their toes into the entrepreneurial pool without diving headfirst into the deep end, franchising offers a life jacket of proven success.
Dr Zalena Mohd and Dr Thanuja Rathakrishnan are Senior Lecturers at the School of Management and Marketing, Taylor’s University. The views expressed in this article are the author's own and do not necessarily reflect those of Sinar Daily.