Despite the growth and potential of franchise businesses, not everyone has an idea why franchises succeed. This may be the reason why the number of franchise establishments in the U.S. hasn’t budged much since 2007.
It’s such a shame, since franchising is a missed opportunity by a lot of aspiring entrepreneurs. There are a lot of huge reasons why franchises are poised for success, some of which we will talk about today.
7 Biggest Reasons Why Franchises Succeed
1. Strong business model
Most franchise opportunities have been tried and tested by their respective owners, especially when it comes to the business model. Buying a franchise means you’re getting a full system, which is extremely helpful for any new company owner.
Imagine starting your own business from scratch. You need to look into a ton of factors to ensure that you can keep the business afloat, let alone start it in the first place. This may include several attempts and errors along the way, all of which may lead you to spend a significant amount of time, effort, and money.
With a franchise, you simply pay for the franchise fee and do what the franchise agreement says. If you follow the instructions to the letter, you won’t have to worry about operational processes. Instead, you can focus more on other factors that need your attention.
2. Brand popularity
Compared to a fledgling business, a franchise carries a brand that a considerable number of people are already aware of. Franchise businesses already have instant recall, especially if you’re opening up a store near an existing franchise.
On top of this, franchise opportunities have already come up with the best branding and marketing strategies for the business. All you need to do is copy the templates and follow what existing franchises are doing.
3. Collaboration with franchisor
One of the best benefits of buying a franchise is that someone else is working with you to ensure success of your business. The franchisor is essentially the brain and heart of the entire franchise network, and this person knows how the business rises and falls. Wouldn’t it be awesome to have exclusive lessons and advice from someone who has started the business from the ground up?
When you get a franchise business, you automatically receive the opportunity to collaborate with the franchisor. People who have opened up their businesses for franchising are very much concerned with the success of their franchises.
Here are some of the things that you can expect from collaborative efforts with the franchisor:
- Training in all operational movements
- Shared resources for advertising and marketing
- Guidance from a business expert to hone your own leadership and business management skills
Whether it’s a bagel franchise for sale or any other kind of franchise, you can rest assured that – aside from you as the franchise owner – the franchisor is also adamant in the favorable outcome of your business.
4. Low cost, big gains
Aside from the fact that a trial-and-error approach in starting a new business is extremely costly, putting up a franchise business is a lot more cost-friendly.
In the case of investing in a bagel franchise for sale, bulk of the operational costs have already been carefully studied and optimized. From the ingredients and consumables down to branding and store furniture, everything has already been sourced out. In other words, the franchisor may provide a list of recommended suppliers who can give you the best items at the lowest possible price.
When buying a franchise business, you need to pay for the franchise fee, local permits and licenses, location rental, initial supply, and salary. This streamlined list of expenses is much easier to handle compared to the juggernaut of financial concerns that you may encounter if you’re putting up a business on your own.
5. Easier approval for financing
When you choose to purchase a franchise with good reputation for high sales, the probability of having your loan approved becomes higher. That’s because financing institutions have already taken notice of these franchises and are aware of the profitability. In other words, it becomes easier for lenders to release financing for your business because they know that you’re set up for success.
In addition, some franchisors are also familiar with financing institutions that they have established good relationships with. Feel free to ask the franchisor about recommended lenders or financial support channels.
6. Staff training and continuous support
Another huge reason why franchises succeed is the training provided for the store staff. Franchisors want newly approved franchise stores to become successful, and so they will make sure that you and your staff know how to keep it that way.
Practically all franchise companies have designed a comprehensive set of training modules to help you start the franchise. Some of the trainings may be conducted in the corporate headquarters, while others are done in your store’s location.
As the franchise owner, you can expect to learn about the operational requirements of the business, sales and marketing strategies, branding guidelines, financial management techniques, staff development and teamwork, and customer satisfaction. All of these things are aimed to reduce the number of mistakes that any conventional non-franchise startup usually experiences.
Best of all, if you have any questions even after the launch of your store, you can always ask the franchisor or the company representatives. Some franchise companies have a system where corporate staff members can drop by your location and help you address store-related concerns.
7. Opportunity to own multiple exclusive locations
Franchise companies know where each franchise is positioned and how many franchises are in one location. As a franchise owner, you have the opportunity to open several stores through a multi-unit franchise agreement. You can even take exclusive territories where only you can put up franchise stores.
In all of these, the franchisor can guide you in identifying the perfect location for your store.
Don’t miss out on the opportunity!
Franchising is a growing industry with a lot of potential. It’s up to you to grab the chance to own a franchise and understand why franchises succeed.
Shmagel’s Bagels has been in the business of selling bagels in Ocean City, Maryland. If you want to take part in the company’s growth, buy a bagel franchise! Go to this page and fill out the form, so that we can get in touch with you.