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| Why
Buying A Franchise Makes Good Sense |
When you buy a Franchise, you're
buying a "business in a box" concept. You will
be an independent business owner with no worries about
branding, product/service development, distribution,
training, marketing, on-going support, or equipment, if
needed. Everything is provided by the Franchisor who has
a vested interest in your success. In most cases, you
don't even require any previous experience in your
chosen industry. For these reasons, it's no wonder that
approximately 92% of all franchises still exist 5 years
later. |
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As a Franchisee, you will
no longer be trading time for money and feeling
unappreciated and underpaid for your efforts.
You will have the opportunity to get out of your
business exactly what you put into it while
providing the lifestyle you wish for yourself
and your family.
The other ways to become a business owner range
from starting up a business yourself to buying
an existing business. Starting a business by
yourself can be a very risky and daunting task.
You will have no public recognition for your
business. You will have to develop appealing
products/services that will be in demand now and
in the future, develop a distribution system,
train yourself and possibly others, devise your
own marketing plan and advertising, have no
on-going support and, if necessary, purchase
your own equipment. For these reasons, it's no
wonder that approximately 80% of all start-up
businesses fail in the first 2 years.
Buying an existing business can also be a very
risky proposition. They usually cost |
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more as you are not only
buying its physical properties and systems but you
are also paying for the existing clientele. One of
the biggest challenges is trying to find out the
REAL reason the present owner is selling his/her
business. Financial records rarely tell the entire
story and it's what you don't know that can
financially ruin you. |
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As a result of the lower risk
factor, buying a franchise has become THE most popular
way to buy a business today.
Franchise Advantages and Disadvantages Snapshot:
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| Advantages |
Disadvantages |
| Typically easier to
finance than independent start-ups |
Dependence on
Franchisor |
| Access to quality
training and on-going support |
Start up costs may be
slightly higher |
| Established concept
with reduced risk of failure |
Less control over
business |
| Systematic
"cookie cutter" business approach |
Payment of franchise
fee to cover initial training, start-up support and
miscellaneous items |
| Access to
lower cost and possibly centralized buying |
On-going royalty
payments in exchange for on-going support,
advertising, new product and/or service research &
development |
| Fewer
start-up problems |
Required standards,
uniformity and control regarding suppliers |
| Use of well-known
trademark or trade name (branding) |
Monitoring
and auditing of your business |
| Access to
cost effective group Advertising |
Term of agreement,
possible renewal fees, restrictions on sale of
business |
| Typically, franchises
appreciate in value quicker than independent
businesses |
Territory restrictions
sometimes can limit geographical growth |
| Typically provides
business site selection and better real estate
negotiating power |
None |
| Able to grow into
multiple locations faster than independent start-ups |
None |
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