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Franchise Business - 10 Reasons Nvest in A Franchise
Franchise Business - 10 Reasons Nvest in A Franchise
ranchising is on a roll.
The sector that brings
household names such as
McDonalds, Pizza Hut and
Subway to our shopping hubs,
also delivers opportunities for
new ventures; think of any service
or retail item, and there will be
a franchise system to match.
4. A competitive advantage
Once the business is up and running,
a franchisee can then turn to the depth
of experience on hand in the network to
gain competitive advantage. It is difficult
for any individual business owner, even
in
established
business
networking
organisations, to get access to the amount of
information that a good franchise system can
supply its franchisees on an ongoing basis.
Already the franchisee has the advantage of
a brand; then there is the hands-on support
and training supplied, and ongoing business
development,
marketing,
franchisor
experience and perhaps most valuable,
fellow franchisees.
The beauty of a franchise network is the
capacity for any individual to draw on the
experiences of others in the same position.
Some franchise systems offer formal forums
for franchisee discussions, some have a
network that is engaged through an intranet,
others rely on mentoring or informal
friendships to help steer franchisees through
challenging times.
The franchisor doesnt have the answer to
everything getting practical advice, and a
reality check, from others in the frontline is
invaluable for a franchisee.
6. Access to finance
Getting a loan from a bank is harder than
it used to be; financial institutions have
tightened their lending criteria, and although
the open for business approach exists, it
can still be tough to get the finance to open a
business.
Banks have an accreditation system which
means franchisees can get a higher percentage
of the franchise investment loaned to them, on
the basis of the franchisors model up to 70
percent. While this can be very beneficial for
franchisees investing in the well-established
brands, the reality is that accreditation plays a
minimal role in financing franchisees.
But the existence of a tried and tested business,
good operating systems, a visible brand and
franchisor experience, can still be appealing
to any lender.
Bankers are risk averse.
8. Access to innovation
9. Opportunity to expand
Just one business outlet might not be enough
for the truly ambitious. A franchise network
can be the landscape in which to set out on
the journey to multi-unit ownership; while
some franchisors are reluctant for franchisees
to step back from their business in order to
focus on developing multiple units many
franchise systems see the value in successful
franchisees expanding their reach and
building the brand at the same time.