Nigel Toplis describes franchise networks as being a group of independent business owners who succeed by tapping into a wider community.
Franchising is the fastest growing and most consistently successful way to deliver products and services. It’s a crazy mixture of conformity and individuality that combines the best elements of big business and small operations.
Many people who want to run their own businesses opt for franchising because of the support network that surrounds it. They wish to take control of their own destiny and become their own boss. This is usually the main reason why people want to switch from being an employee to becoming a business owner.
Another motivating factor is that they want to be rewarded directly for their own efforts. And by taking this route they are able to build a valuable capital asset, by learning new desirable skills.
One other reason for changing direction may revolve around the family – and long term business ambitions. By establishing a successful business, it could provide employment for other family members and when the time comes to step down from running such an enterprise, the company can be passed on to someone else – or shared among a group of people.
Successful franchisees come from all walks of life. Within our own franchise brands, we have individuals whose experiences range from cattle ranching in Patagonia, to being a greengrocer in Chiswick, or working as a flight attendant with British Airways.
Yet what all these people have in common is a desire to succeed. There must be a willingness to work hard and an understanding that the franchise model and its systems should be followed to the letter at all times.
Alternatively, running your own independent business can be lonely and expensive. If you start your own business, you are responsible for every aspect of it. With franchising, however, you get all of the benefits of owning your own business, but backed up by a raft of head-office support services.
In addition to giving a new business partner access to their successful brand, the franchisor is there to provide assistance when the fledgling new owner needs it. The franchisor has experience, know-how, marketing tools, sales training and technical guidance. They have also developed a corporate identity and associated trademarks.
Not only this, but once you have set up your franchised business you will be able to network with other franchisees. This allows you to share best practice and advice. By being part of a bigger group of people, you will be able to enjoy economies of scale when it comes to buying services and supplies for the business.
Another benefit is that research and development is carried out by head office, and then rolled out to its community.
So what are the disadvantages to being a franchisee? If you set up your own independent business you can do whatever you want. However, as the owner of a franchise territory, you have to sign a legally-binding agreement to adhere to the expectations and rules stipulated by the franchisor.
It is always important to be honest in all of your dealings, including the payment of ongoing fees to the franchisor. The key is to make the most of the franchisor’s systems, while working hard to build up high levels of repeat business. There’s certainly no point in becoming a franchisee if you simply want to do your own thing, and not be part of a bigger network. Mavericks do not make good franchisees.
Franchising is not for everyone but there is an overwhelming case to be made in its favour. One thing that remains true: It’s that franchising allows you to be in business for yourself but not by yourself.
