Whether you are interested in doing business with a franchise system? Before deciding to plunge into the franchise business, it's good You know what the advantages and disadvantages of that franchise business.
Many people start a business franchise business and select a generalizations of the build your own business from scratch without knowing the strengths and weaknesses. Indeed it was the right of each person, but it would be better if we know what the advantages and disadvantages of running a franchise business.
Quoted from the website of Companywarehouse.co.uk, the following are some of the kelebiihan and lack of a franchise business you must know before running it.
6 advantages of Business Franchises
All types of businesses must have their respective advantages, so too is the case with business franchise. The following are the advantages of a franchise business:
1. Business Management has woken up
Franchise businesses that have good reputation usually have had business management that could give an advantage to their partners. Business ideas, name brand,and the franchise business management system has been tested and stay implemented in the new location.
2. Brand already known community
Brand already known community will make the process of marketing a franchise business becomes easier, especially when the products sold are the products needed and preferred by the community.
This of course would be easier to market the products sold to the public, so that the cost and effort incurred to build the reputation of the business is not as hard as when we build a business from scratch.
3. Ease in financial management
Most investors prefer to provide capital in a business that proved robust in terms of financial and marketing network. Join a franchise business providing financial management system because of its advantages have been defined by the franchisees. Franchise partners need not dizzy anymore on this matter as it does occur at the new business started.
4. The cooperation effort has woken up
Those who buy a franchise brand will benefit others, namely business cooperationthat has woken up properly before. Some examples of the benefits is in terms of the suppliers of raw materials for the products sold, advertising and marketing agencies.
5. Support and a stronger security
Usually the franchise owners give special training to their partners before operating. This training includes financial management, marketing strategy, a way of advertising, how to run a business, and others. The training is usually already included inthe purchase of a franchise package, so that the partners will be facilitated in undertaking their business according to the standard.
6. The advantages of the larger franchise business?
If a profitable franchise business, sort of course profitable. But if we assume that the profit from the business this franchise will be greater when its franchise brand is famous, it's not necessarily. There is usually a franchise system with discounted fee, where advantage partners fraction will be the rights of the owner of the franchise.
5 Lack of Business Franchises
All kinds of business there is definitely a shortage and its own challenges, as well as business franchises. Most franchise partner is not a problem with this deficiency, but also not a few prospective partners who decided to resign. Here is a lack of business franchise:
1. less franchise Partners have control
Franchise partners usually do not have full control on franchise business that he bought, because all the system predetermined by the franchise owners. When the partners want to innovate or change, it is stuck with the terms and perturan the already agreed from the beginning. The existence of these barriers, your ideas as a franchise partner can not be applied to your business.
2. franchise Partners are bound by the supplier
Usually the employers will be looking for the supplier (supplier) which offers a smaller price. This is not you can do when you're buying a business franchise. When franchise owners have determined supplier since the beginning, then a franchise partner can not buy or choose another supplier.
3. Affected on the reputation of another franchise
This is one of the biggest shortcomings of the franchise. When the reputation of the other franchises (for the same brand) polluted because of their own fault, then your business will also join suffered. Sometimes it can happen that a significant decline in turnover on the entire branch franchise when this happens to one of the partners.
4. The existence of franchise fees
Almost all business franchise fee system applying to their partners. Franchise owners will submit the initial cost to buy the franchise. In addition, there is also the ongoing costs charged to partners, usually it is for training and support to franchise buyers.
5. Cutting benefits
In addition to the franchise fees, franchise partners also have to pay royalty fees to the franchisor, namely cutting of some of the benefits you get. If Your just a littleit turns a profit, then the profits remain cut to cover the cost of royalties.
But not all such systems impose a franchise brand. So you have to ask about it since the beginning.
Well, above are some of the advantages and disadvantages of business franchisecan be a consideration for you. Basically any type of business does have its advantages and disadvantages of each. By knowing these things early on, You can do the calculation that matured early on before deciding to buy a franchise business.
