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Franchising is a great option to take if you're looking for a new type of business to invest in. While it has many advantages, you must know that there are certain drawbacks as well. Remember that not everyone can successfully run a franchise; sometimes no matter how great an entrepreneur is, he or she may fail not because of a lack of skills but a franchise simply is not the right type of business for them.
I suggest that you should first find out more about franchising and decide whether it's suitable to your needs and preferences. To help you with this, I've prepared a list of the pros and cons of having a franchise:
Advantages of a Franchise
• You get to have your own business in only a short period of time, usually 3-6 months depending on the type of franchise you bought
• You can have your own private location so you won't have to compete with your fellow franchisees
• You won't have trouble attracting customers and making sales especially if the brand you've franchised is very popular
• Advertising is not a big problem because your franchisor will take care of all the promotions for the company products and services
• You have strong connections with clients, suppliers and other professionals because you belong to a powerful network
• There are fewer risks involved and you're most likely to be successful in this type of business provided that you manage your franchise well
• You can make use of your franchisor's financing options if you don't enough capital or simply borrow a loan (loans for franchising are easily approved by banks)
Disadvantages of a Franchise
• You have to comply with all the rules, regulations and standards in order to keep the reputation of the company name you're carrying
• You don't have full control over your business
• You can't make your own decisions because the top management has the final say on every issue, so if you have concerns or suggestions, you have to inform your franchisor first and wait for approval
• You have to give a percentage of your sales to your franchisor every month for royalties, even if your franchise is not doing well financially
• Once you sign the franchise agreement and other documents, you have to finish the term
• You also need to implement the necessary upgrades on machinery and methods required by your franchisor so that all the outlets maintain the standard
Now that you know the pros and cons of a franchise, you should carefully weigh your options before you enter this type of business. If everything seems favorable to you, then go ahead and proceed. However, if you're not a hundred percent sure about the terms and conditions, it's best to find another business that's more suitable for you.
I suggest that you should first find out more about franchising and decide whether it's suitable to your needs and preferences. To help you with this, I've prepared a list of the pros and cons of having a franchise:
Advantages of a Franchise
• You get to have your own business in only a short period of time, usually 3-6 months depending on the type of franchise you bought
• You can have your own private location so you won't have to compete with your fellow franchisees
• You won't have trouble attracting customers and making sales especially if the brand you've franchised is very popular
• Advertising is not a big problem because your franchisor will take care of all the promotions for the company products and services
• You have strong connections with clients, suppliers and other professionals because you belong to a powerful network
• There are fewer risks involved and you're most likely to be successful in this type of business provided that you manage your franchise well
• You can make use of your franchisor's financing options if you don't enough capital or simply borrow a loan (loans for franchising are easily approved by banks)
Disadvantages of a Franchise
• You have to comply with all the rules, regulations and standards in order to keep the reputation of the company name you're carrying
• You don't have full control over your business
• You can't make your own decisions because the top management has the final say on every issue, so if you have concerns or suggestions, you have to inform your franchisor first and wait for approval
• You have to give a percentage of your sales to your franchisor every month for royalties, even if your franchise is not doing well financially
• Once you sign the franchise agreement and other documents, you have to finish the term
• You also need to implement the necessary upgrades on machinery and methods required by your franchisor so that all the outlets maintain the standard
Now that you know the pros and cons of a franchise, you should carefully weigh your options before you enter this type of business. If everything seems favorable to you, then go ahead and proceed. However, if you're not a hundred percent sure about the terms and conditions, it's best to find another business that's more suitable for you.
Chad Gordon is a well-experienced franchise consultant whose passion is to guide people in finding the perfect franchise opportunities. Aside from giving helpful advice to clients, he has also been managing his own franchises for several years now. To start your search for the best franchise opportunities, visit http://buyafranchisehere.com today and you may just find exactly what you're looking for!
Article Source: http://EzineArticles.com/?expert=Chad_Gordon
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