Franchising or Own Business

entrepreneurs
newbusiness
franchise

#1

Is “Franchising” more successful or “starting an own business” from the standpoint of an Entrepreneur? How is one more advantageous/ profitable than the other?


#2

Hi,

Franchising does make it easier to start off a business, as the processes and engines are already developed and just need to be extrapolated to a new location, thereby making it an attractive option. For example, if you are thinking of franchising a gym or an ice cream parlour, all you would really have to do initially is to find a piece of land that fits the requirements for the business and post that initial set-up would be the onus of the home company.
Now lets look at certain cons of franchising. While easy set-up sounds like a good option, franchises do take a share in the profits. Moreover, your flexibility is very limited in terms of what you want to sell and how you want to sell. Coming back to the ice cream business to explain this, if one day you decide that waffles are something more that your customers are interested in, I am afraid you would not be able to do so as doing the same would entail a breach of contract with the home company.
Moreover, franchising only makes sense if a particular brand has a good market presence and reputation. In case it doesn’t it is always better to take the efforts of starting up your venture as you would be able to exercise more control over the same (plus, your profits would be yours).

Hope this helps.