With the UK franchise sector continuing to prosper, an ever-increasing number of people are looking to realise their business, lifestyle and financial dreams through franchising. According to a recent British Franchise Association survey the number of franchisee-owned businesses has increased by 14% in the last two years.
But is a franchise right for everyone? We take a look at the advantages and disadvantages of franchise ownership.
Dedicated franchisee support
Centralised franchise support is without doubt one of the biggest advantages of owning a franchise. The benefits of franchise support span the entire spectrum of the franchisee journey, from the moment you become a franchisee to the day you open your business and beyond. This can include everything from negotiating preferred supplier discounts to marketing.
We ask prospective franchisees at our énergie Franchise Discovery Days to guess the number of steps there are between the time they sign their franchise agreement to the time they open their business. The answer usually astounds them. This really highlights the value in a franchise support system. Imagine launching a new business only to later discover there were hundreds of factors you hadn’t considered and the impact this would have?
A franchisor will know every step of the process and will have the experience and knowledge of having guided many franchisees through that same process before you. They are there to provide timely advice and support through every step of the journey.
No experience necessary
Franchise support is also crucial if you’re looking to start a business in a new industry and one that you are not accustomed to or don’t have any prior experience in. Many people look to franchising as an opportunity to change career paths and own a business in a different sector or industry. The franchise support system will give you all of the relevant industry-specific training you need to operate the business.
Once you’re up and running a support team of experienced industry professionals will always be on-hand to offer advice and support when you need it.
The power of the brand
As a franchisee and being part of a wider network you benefit from preferential rates from suppliers and significant cost savings. For instance, if you were to set up your own gym, the cost of kitting out the gym with equipment on your own would be significantly higher than if you were to do it as part of a franchise. This is simply because of the arrangement, relationship and terms the franchisor will have established with the supplier and the volume of equipment they buy through them.
A proven business model
It goes without saying that investing a proven business model is one of the key reasons why people choose to go into business with a franchise. There is enormous benefit to operating a well-established tried and tested business model that has stood the test of time.
What’s more, in addition to the franchise support team you also have the benefit of the wider network of franchisees, many of whom will be more established and can offer help and advice to new franchisees. Regular franchisee networking events provide the opportunity to interact with other franchisees and share best practice.
Restrictions of the franchise system
When operating a franchise you are buying into a tried and tested business system and you will be required to follow the systems. This means that if you’re looking to re-invent the wheel, then you could find a franchise restrictive.
Similarly, you can’t simply pick and choose the elements of the system you want to run and neglect the others. The franchise model is built on the system as a whole and in order to run a successful franchise and not fall into compliance issues you will need to use the systems in their entirety.
There’s no cutting corners
Franchisors take their brand very seriously, and rightly so! They have invested significant amounts of time and money into establishing the brand and are highly protective of it. Therefore, you can’t cut corners on any aspect of operations, marketing or service delivery.
This can come down to things such as using the correct branded template when displaying a notice in your business, rather than just simply copying and pasting the logo onto the document.
Good franchisors will regularly audit their franchisees, and the benefits of this are two-fold. Firstly, the franchisor can ensure that their standards are continually being met ensuring that the service delivery isn’t compromised and remains consistent with the brand standard.
Secondly, for the franchisee audits can help to highlight areas of improvements for the business that can drive performance. At the same time an audit can re-enforce the good things you are doing in your business giving you the confidence and knowledge that you are going about your business in the right way.
So why does this sit in the potential disadvantages? During an audit a franchisor will maintain that every aspect of the system should be followed. Therefore, during an audit you could be marked down for not displaying the correct branded template for a poster. This may appear trivial to you but is essential for the franchisor.
That said, your entrepreneurial creativity and flair doesn’t have to be restricted by owning a franchise. Following the franchise systems in their entirety combined with your own entrepreneurial flair can be the perfect blend for franchise success. Some franchisors can be open to ideas, feedback and input for new initiatives from franchisees, providing that the franchisee has a track record of performance based on following the business system.
Ready to learn more?
If you want to learn more about the benefits of franchising with énergie simply complete the form below to receive a full Franchise Information Pack.