You have decided to buy a business, that’s great news. Now you are trying to decide if the business you buy will be from a private owner or part of a franchise. Which type of business would be right for you? Let’s look at both sides.

To Franchise

If you buy an already existing franchise location, you inherit all of the benefits of a franchise without many of the downsides. You get a built-out location, the brand, an already trained staff and tried-and-true operating procedures. You typically won’t pay the same franchise fees that the original owner of the location did, instead you will pay a transfer fee.

Although the franchise fees may seem expensive, you need to remember that what you are buying with those fees is a brand and structure that you won’t have to come up with on your own. If you buy into a larger franchise, then you may not need as much focus on marketing as you would in a privately held business as customers with brand loyalty will seek you out.

Not To Franchise

If you want your business to go in it’s own direction, then a franchise is definitely not for you. You will not be able to change the name, the menu, etc. as you see fit.

If you want to start with a new franchise location, you will face the same issues any start-up would with the additional cost of buying into the franchise with franchise fees. You will need to pay for the location and the build-out, which will need to follow the guidelines of the franchise. You will have to train your own staff, and while you might be able to borrow some training help from the franchise itself, the staffing responsibilities will be all up to you.

If you do deviate from the franchise agreement, you risk having your franchise license suspended, which is not an issue you would ever have to contend with as a private business owner.

What To Do?

As with any business decision, there are risks that cannot be avoided. Owning a franchise can be a very profitable endeavor, but you will have to play by the franchise rules. The best thing to do if this a decision you are considering is talk to an experienced and qualified business broker about the good and bad of franchise ownership. They will be better able to guide you than the brokers and representatives of the franchise you are considering who are hardly objective in this situation.

Are you considering becoming a franchisee? Do you have questions about the process? Do you have questions about the good and the bad of franchise ownership? Ask us! Please feel free to leave us a comment or question here, and we will be happy to help you with buying a franchise.

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com