There are many benefits to franchising, a system that enables an individual to own a small business, using an existing brand, in order to compete more effectively in their local market. Unlike a traditional small business model, in franchising, you are in business for yourself but not by yourself, benefiting from the brand’s strength and business model, as well as their intellectual property, advertising, marketing, support, supply chain, and training. Another benefit of being part of a franchise is the sharing of knowledge and best practices not only from the franchisor, but also the brand’s other franchisees. Here are just a few of the many benefits a franchise network can offer someone who has a dream of owning their own business.
1. A model for success
Aspiring business owners see the value in buying into a system that has been successful for others. We understand this concept on a daily basis whether it’s reading reviews to know which car to purchase or asking our friend to refer a doctor to find a trusted practitioner. Franchising can provide that peace of mind, as long as you are dealing with a reputable franchisor with extensive franchising experience, a focus on franchising best practices, and a brand with proven success. This incredibly effective model truly assists people on the path to reaching their business ownership success goals. Franchising is the most democratic form of wealth creation, providing the franchisee the opportunity to generate economic output, create jobs, and build generational wealth. In our brands, we focus on franchisee profitability, as we truly believe it is the foundation of franchising best practices.
2. Trusted reputation and brand awareness
Instead of having to build a brand from the ground up, joining a franchise network brings years of established recognition and brand awareness. With the starting point of a solid foundation on day one, a business owner is able to leverage what has already been created, instead of starting with nothing. This brand recognition and reputation allows business owners to have a great head start, even if they’ve never owned a business before. They are able to learn from and build upon the success of those who have come before them.
3. Assistance with day-to-day operations, training and support
Many franchisees have shared that the reason they chose a franchise business is the extensive training and support they knew they would receive from the team at the franchisor. Our committed team focuses on providing excellent training, operations support, sales and marketing advice, and supply chain savings, which leads to our continually high scores of franchisee satisfaction. Small business owners have the daily challenge of wearing many different hats, and oftentimes, they struggle to run all parts of their business effectively. By purchasing a franchise business, someone not only purchases the business but, in addition, they benefit from an entire support team (from marketing to sales management, operations and more) who are merely a phone call or email away. Franchising gives franchisees many tools and the business acumen needed to leverage their growth. This system helps them implement a high level of business intelligence so the entire network stays up-to-date in areas of buying patterns, new services and products, and customer trends. This not only happens from the corporate team but also across the network from franchisee to franchisee. By cultivating a “sharing is caring” network, our franchisees become mentors and coaches to their fellow franchisees.
4. A More Robust Marketing Approach
Small business owners often have such limited capital to devote to advertising and marketing. In a proven franchise system, a business owner has the national or regional ad spend backing them, in addition to marketing programs, processes and strategy provided by the Marketing team at the franchisor. Through hiring a team of skilled marketing professionals from social media experts to marketing strategists to SEO specialists, this support team assists franchisees through their knowledge and experience. Devoted to the franchisee’s success, marketing services that are provided span from creating digital and physical assets to using data science to understand customer buying habits, as well as helping franchisees leverage their own marketing budgets to most effectively reach current and prospective customers.
5. Provides a more challenge-resilient option for business owners
A well-built matrix of support from supply chain to business consulting to training to leadership development, enables a franchise owner to more sturdily position themselves for continued success, no matter what is happening in the economic landscape. As our team witnessed during the pandemic, the franchise model is one that weathers challenges–expected and unexpected–in a more supportive, coordinated and collaborative way than an isolated small business trying to go it alone. With the power of size and scale, the opportunities available to franchise owners can also include things such as more affordable health insurance options to accessing higher vendor discounts across the supply chain.
6. Spurs Innovation Across the Network and Beyond
When everyone works together for the benefit of the brand, you witness an amazing camaraderie and sense of innovation. For example, during the pandemic, many of our franchise owners began creating PPE, safety shields, and signs to keep communities safe and healthy. These resources were then shared across the network for others to utilize, which then inspired others to think of their own innovative ideas, which were then shared across the network. Franchising’s ability to continually adapt to new circumstances and changing market conditions has become an important factor in its expanding global influence.
Importantly, not all franchisors are created equal. Before you buy a franchise, please conduct thorough diligence, including reading their Franchise Disclosure Document, with special focus on their Item 19 Financial Performance Representation (if they do not show results down to profit, you need to be wary). A critical part of your diligence should also include talking with many–at least 25–of their existing franchisees, asking about their satisfaction, support, profitability, and if they had the chance to to it all over again, would they.
I love franchising, and I’m thankful every day that I get to help so many people fulfill their dream of becoming business owners and building generational wealth.
CATHERINE MONSON, CFE
Propelled Brands, CEO
Immediate Past Chair of the International Franchising Association, IFA
Catherine Monson brings 30 years of franchising and management experience to her role as CEO of FASTSIGNS International, Inc., and Propelled Brands, the multi-unit franchisor that includes FASTSIGNS®; SIGNWAVE® in Australia where FASTSIGNS centers operate under the SIGNWAVE brand; NerdsToGo® and Suite Management Franchising, LLC, the parent company of MY SALON Suite® and Salon Plaza®.
Source: Franchising Magazine USA