E-Source Says
The Entrepreneur’s Source Reviews: Startup or Franchise
The Entrepreneur’s Source Reviews: Startup or Franchise
In the fiercely competitive marketplace, individuals looking to explore new employment options beyond working as an employee have a lot to consider. Owning and operating a small business was once considered the exclusive domain of risk takers and innovators who failed to fit in to the traditional corporate setting.
Now, employment options have expanded to allow for a wide variety of personalities to take on business ownership and empower individuals to grow professionally. This comes at a time when many companies faced economic uncertainty and employment confidence waivered.
As a result, men and women have begun researching two viable employment options – starting their own company or purchasing a franchise. The decision between the two requires introspection – does an individual want to assume total risk or reduce the learning curve and limit the risk by investing in a franchise. The key questions posed by many emerging small business owners are asked very emphatically, “Can I achieve my goals and objectives as part of a franchise system? And, do I have what it takes to be a franchisee?”
Risks Associated with Startups
We’ve all heard the troubling statistic that half of all startups fail within their first five years, but the actual number is even bleaker. According to the most recent statistic from the U.S. Small Business Administration, about 44 percent of new businesses close within four years. In addition, about as many organizations close or go bankrupt as there are new startups each year.
Some of the primary risks associated with starting a new business, reported Cayenne Consulting, include:
- Market risks
- Competitive risks
- Technology & Operational risks
- Financial risks
- People risks
- Legal & Regulatory risks
- Systemic risks
These common risks can often lead to losing money and personal sacrifice. Getting a business up and running takes considerable time and resources, which is why many professionals, who are considering owning their own business, turn to franchising. A franchisor has already worked out many of the associated kinks of running a company, including creating a list of vendors, marketing best practices and developing a personnel training program.
Benefits Associated with Franchising
Owning a franchise allows an individual to go into business for themselves, but without the fear and struggle that is associated with creating a business alone. The established product or service has a proven business model that creates a pre-sold customer base, which would ordinarily take a company years to establish.
However, a franchisee must be willing to follow and adhere to a franchisor’s business system and ultimately follow the practices created in those agencies at all times. The uniformity across all of the various franchise locations is paramount to brand awareness – leading to company and franchisee success.
Franchising is a leading entrepreneurial option for those who wish to take ownership of their future by being in business with themselves, without being in business alone.