Getting a franchise package: what are the advantages?
Why Franchise? Potential franchisees sometimes wonder if franchising is a necessary process, and may ask why they couldn’t simply start a business on their own. The findings of the government suggest that franchisees enjoy a significant competitive advantage over the stand-alone or single business operators.
They showed a study that 88% of franchise companies which opened in the previous five years were still in business under the same owner and only 4% of these businesses failed.
Also, a survey in that same article showed 60% percent of all new businesses that started over a 10 year period dissolved within their first six years.
The percentages of success may vary with the study and that there maybe other studies out there but still reach same conclusion most suggest that a franchised business have a higher chance of success than independent, start-alone businesses.
Reasons contributing to this include:
- A franchise is a “copy” or “duplicate”, if you may, of an already successful business. The true value of a franchise is the experience, know-how, and the operation procedures that comes with it.
- In franchising, there is the value added advantage of brand name recognition.
- There are also support structure from the franchise company that the franchisee can take advantage of.
- A franchise avoids the costly trial-and-error periods that causes so many start-up businesses to fail and close up.