Question: I'm thinking about leaving my job and starting my own business. I've read about all the advantages of buying a franchise, but I don't know if franchising is right for me. Is everyone cut out to be a franchisee? How can I know if buying a franchise will be the right decision for me?
Answer: There are so many advantages to starting a business by joining an established franchise system that many people assume it's always the best way to go. And, in fact, for many, franchising is the perfect choice. Established franchisors provide you with a strong brand name, which often translates into an immediate customer base. The franchisor's training programs teach you how to run the business, and its support programs provide assistance and advice once you have the business up and running. All the answers regarding what type of site to look for, how to develop the location, what types of equipment you need, where to get the equipment and countless other start-up questions are provided by the well-established franchisor. Most important, the franchisor can help you project how much capital you need to get the business started and keep it going. Not being able to estimate the amount of money you need is one of the main pitfalls of starting a new business.
Becoming a franchisee in a well-established franchise system has many advantages over starting a new business independently, but keep in mind, becoming a franchisee is not for everyone.
The first thing you have to understand is franchisees aren't entrepreneurs in the classic sense. Entrepreneurs want to make their own decisions. They like to experiment with the menu, services, décor, advertising, staff uniforms and suppliers-they have the need to develop and operate the business based on their own vision of how things should operate. But if a true entrepreneur were allowed to operate a franchise, there would be little consistency between one location and the next. Consumers stopping off to get their favorite hamburger might find that their local McDonald's, Burger King or Wendy's was now serving Chinese food, because that's what the owner decided he wanted to offer in that restaurant. It would be pretty confusing.
Good franchisees aren't so much entrepreneurs as they are "entrepreneurs lite." They're provided with a system of doing business and, within great franchises, standards for using that system. The secret of success for most franchise chains is that consumers can't tell whether any location is company-owned or franchised based on the product or service offered or its quality standards. Unless they happen to notice the sign behind the counter telling them the business is independently owned and operated, they would probably assume all the restaurants under that brand were owned and operated by a single company. It's the promise of consistency that drives customers to a franchisee's door.
An "entrepreneur lite" takes the basic system and makes it better-not by changing the menu, but by providing, say, cleaner bathrooms or by training a staff to provide great customer service. A great franchisee improves the performance of the system simply through better execution.