“Entrepreneurship is exploiting an opportunity regardless of the resources currently available” says Howard Stevenson, Professor of Business Administration at the Harvard Business School. He elaborates that “the key to this perspective is the focus on opportunity (and not on resources).”
With a wide range of rewarding business prospects in the country, the business fraternity has experienced a boom over the past few years. Entrepreneurs and other investors are voluntarily stepping-forward to spend their time, efforts, skills, expertise and most importantly huge sum of money to establish their own business. Entrepreneurship involves several kinds of risks viz. strategic, financial and other operational risks associated with it. An entrepreneur undertakes the risks ranging right from the inception of the business idea till the time the business is completely established. Moreover, with the advent of several stiff competitors in almost every sector, it is a wise man’s decision to opt for such a route that shall not only be rewarding but less risky as well. Thus, it requires a great deal of efforts to start a business in any sector. However, a budding concept for establishing a business for any entrepreneur is to tread on the franchise path.
The concept of franchising has created a stir in business sector, offering great business opportunities to young entrepreneurs to climb the ladder of success via franchise en-route. In its true sense, ‘Franchising is being in business for yourself, but not by yourself’. Franchising is a great way to have your own successful business and work in your special way. Franchising is such an alluring concept that allows an entrepreneur to fulfil his/her dream of becoming his/her own boss. It is a stress-free and time-tested way of doing the business that enables the aspiring franchise owners to operated business without being completely on their own.
In the current scenario, the growth of franchising is inevitable because it clearly offers aspiring new business owners the best possible chance of succeeding. Enlisted below are some of the crucial points that will answer the question ‘Why franchising makes sense for an entrepreneur?’ and compel you to select a franchise opportunity, if you wish start your own business.
Pleasing for Beginners’ – Franchising is such a luring venture that it appeals to people having no previous experience of running a business and transform into successful entrepreneurs. By presenting a proven business model, coupled with hands-on training, the art of franchising is capable of completely transmuting novices into accomplished entrepreneurs. Sense of Independence – Franchising enables an entrepreneur to become his/her own boss as he/she need not reinvent the wheel. The concept of franchising makes sense for an entrepreneur as it ultimately leads to greater chances of success then if the franchisee was to operate independently.
Proven Blueprint – After venturing into franchising, an entrepreneur is legally entitled to adopt the franchisor’s tried and tested, proven, ready-made business model and code of conduct. Thus, an entrepreneur will reap the benefits of a proven track record of the franchisor.
Reduced Risk – One of the major underlying factors that fascinates an entrepreneur to opt for franchising is the reduced risk factor involved. The risk of failure is comparatively lower than starting an absolutely brand new business. This is so because when an entrepreneur buys a franchise, he/she buys the system that works.
Easier Finance – By opting for a franchise, an entrepreneur receives financial assistance from the franchisor, as he/she makes arrangements with the banks and other financial institutions to lend money. However, the responsibility for the repayment of the loan amount shall be borne by the franchisee only.
Low on Cost, High on Returns – The primary benefit that a franchisee reaps is the low cost of investment. This is due to the reduction of costs and the savings made in administrating and advertising the franchise outlet. Moreover, association with an established brand name ensures assured profits and returns on investments, which ultimately ensures faster cash flow for the entrepreneur.
Mentor & Peer Support – Franchising benefits the franchisee with ongoing training and support from the franchisor. Moreover, with the support and guidance from the mentor viz. the franchisor as well as from the peers viz. other franchisees, an entrepreneur becomes competent to conduct its set of operations, in a stress-free way.
Develops Faster Customer-base – Once an entrepreneur gets associated with an established brand name, it becomes easy to fetch the targeted consumers. This is due to the strength of the brand and loyalty of the customers spread near or far.
Exclusive Territorial Rights – By venturing into a franchise, the franchisor guarantees predetermined territory to the franchisee that assists in succeeding within that territorial region. This relieves the entrepreneur from not having to compete with another franchise location of the parent company.
Moreover, franchise investment is one of the safest businesses that involves less cost and more revenue. Besides this, indulging in business franchising is a win-win situation for the three parties involved i.e. franchisor, franchisee and the end-user of the product/service.
In a nut-shell, franchising does makes sense for an entrepreneur as it is the best way to perk up the business and get the desired results.
