The process of starting a new business often occurs with lots of difficulties, it is pretty much difficult to go through the process of backing bread from the scratch.
Starting a new business usually comes with so many risk, you might not even be able to discern the next line of action. However, I have learnt that the act of purchasing a franchise is usually less difficult than building a new business entirely.
Purchasing a franchise could be compared with getting a good recipe and the reason is because the one who owns the franchise already made lots of mistakes which have been developed and corrected over time, the franchise has successfully handled the stages of trial and error, this implies that during the process of buying a franchise, there are so many things you buy with it.
While buying a franchise, you are also buying the name, the knowledge a well as the expertise that has been acquired by the business owner over time, which makes it possible to overcome certain risk associated with the business and this means that with a franchise, there are lower chances of failure.
Description of a Franchise.
A franchise could be described as a business purchased by a franchisee.
A Franchisee is the individual who purchases the franchise.
A franchisor is the company that is selling out its business name to buyers.
Advantages of Purchasing a Franchise.
• Buying a franchise reduces the risk associated with failing in business, this is because the franchisee is buying an existing system that has been through various test and bad times.
• The franchisor is always available to give guidance and advice wherever necessary.
• Since the franchise has been existing for some time, it will have connecting with advertising and marketing agencies which will make association with bigger franchise and other amenities easier instead of trying to build relationships from the scratch.
Disadvantages of Purchasing a Franchise.
As good as it sounds to be a franchisee, there are certain disadvantages associated with it and they are:
• The process of purchasing a franchise is usually expensive and the reason is because with the business, you are also purchasing the logo, the expertise, as well as the system involved in the system.
• The signed contract might still leave the franchisor in a great power position and this might result in an unhealthy relationship between them.
• As a franchisee, you do not possess the right to run your business the way you seem fit, this is because you have to run your business with the set principles of the company.
While lots of franchisees find it difficult to get along with franchisors, there are others who find it easy to get along. The truth is that, there are good franchisors and there are also bad franchisors, it however depends on the franchisee to make proper research before venturing into the process of acquiring a franchise.