The franchise model has been popular in Australia for decades, with many people wanting to become their own boss, see the fruits of their labour, or simply have a change in career or lifestyle.
So why wouldn’t you just start your own business?
Starting your own business may be a great idea, but it comes with high risks and is not for everyone. Franchises actually have a higher rate of success than start-up businesses*. Many appreciate the lower level of risk, especially those with commitments such as a family and/or a mortgage.
Another sticking point for many budding entrepreneurs is finance. Many find it easier to obtain finance for a franchise*, as lenders will see that you are putting it towards a proven business model with structure and support.
It often costs less to purchase a franchise, and a good franchisor will outline these costs for you. Those who go it alone do not have this luxury and often feel underprepared and overwhelmed as the bills come in.
Another consideration is the skills and training involved. If you were to start a new business tomorrow, would you have the skills to run that business successfully? Do you have skills in producing a product or service that people will pay money for? Those who join a good franchise will receive training in producing the product/service and also in administration and management. If you succeed, the franchisor succeeds, so it is in their best interest to ensure that you are well prepared!
However, becoming a franchisee is not for everyone!
Even though the franchisor has provided you with a business model and a number of leads, it will still require a lot of effort on your end to make it work, especially at the start. People may have heard of the name of your business, but you still need to look after your customers and strive to build relationships and gain repeat business and positive word-of-mouth.
Those who simply want to become their own boss and avoid taking orders may also be in for a shock! You may not have a manager working next to you, however those who become a franchisee find they have a new boss – their customers! Managing requests that you may find unreasonable or difficult to fulfil is common – those who can handle this in a calm manner will be able to survive almost any challenge that is thrown their way.
In the following video, The Graffiti Eaters managing director Mark Mackenzie discusses the franchise model and what type of people can benefit from it: