Did you know food franchises account for 36% of all the franchises in the United States? One major factor is that there are all kinds of food that people eat. We have bakeries, coffee shops, dessert places, fast foods, and more.
Another factor is that people turn to franchising as a second job or an opportunity to get out of their day job. They then choose food franchises, as they think that it’s the most profitable since “people need to eat.”
That’s a common misconception, though, as it’s hard to enter an already saturated market.
Aside from that, there are other misconceptions about franchising that can be harmful. Read on to find out the 5 most common ones and to learn some quick franchise facts:
Misconception #1: The Franchisor Will Do the Heavy Lifting
The franchisor will already have the business framework set up. For that reason, the franchisee only needs to shell out money, right?
That idea can never be more wrong. First of all, the franchisor may require a business plan from the franchisee. Apart from that, they have a set of standards that you must adhere to before you’re awarded a franchise. They want you to succeed, but they won’t do the heavy lifting for you.
You’ll have to study their strategies and come up with your own for your franchise. They won’t meddle with day-to-day operations. They do, however, provide training and support systems throughout your franchise life.
Still, it’s up to you how you want to run your business based on a set of pre-arranged conditions. Remember that when you buy a franchise, you’ll only be paying for the right to use the brand name and the right to operate your business model in a certain location.
Misconception #2: There’s No Creative Freedom in Franchising
With that said, you also have creative freedom when you decide to run a franchise. The franchisor won’t be meddling with you; they’ll only provide the framework. That means you’ll be in charge of the hiring, management, and such.
The only limitations would then be the menu, color scheme, signage, uniforms, and so on. Protocols are already set by the franchisor, too. These are already proven formulas, which allow you to represent the brand in a professional way. Outside of that, you can come up with ideas of your own and even make suggestions to the corporate.
If you like exercising the creative side of your brain, you may focus your skills in marketing. You can think of fun ways to promote your brand and your franchise. For example, you may produce content as you wish or organize events for brand awareness.
If you like looking at data and coming up with ideas on how to improve it, stay in operations. A franchisor won’t try to limit you as much since they want you to succeed, too, so they can succeed.
Misconception #3: You Should Only Look at the Biggest Brands
McDonald’s and 7-11 branches look profitable, aren’t they? However, they’re not always the best choice, especially for beginners. Smaller franchises are pretty profitable, too.
Of course, there are advantages to choosing a well-recognized brand. You shouldn’t limit yourself to them, though, if you’re after success.
Don’t discount newer franchisors; they have the potential to grow bigger. When that happens, franchise fees will soar up but not for you.
It’s a risk for sure, but it can be a huge opportunity for you. You only need to research well and study the franchisor’s business model. Make sure it already has a track record and it should be able to provide at least 2 years of financial records.
Furthermore, you should also look at franchises outside of the food industry. There are fitness centers, for example, and professional cleaning services for businesses you can apply for. In fact, Quick Service Restaurants only account for 25% of franchises in the United States.
Misconception #4: Success is Almost a Guarantee for Franchisees
Many people think that buying a well-known brand means money will come in an instant. That’s not the case, however; it still hinges on your ability to run the franchise well.
It’s no doubt that you have higher chances of success compared to small businesses, especially if you choose a franchise that already has a solid reputation. You’re also given tools to work with; in short, you get a boost at the beginning of your business.
Nevertheless, you still have to know how to utilize those tools and build upon the foundation that the franchisor has already set for you. There are McDonald’s franchises that fail even if it’s a worldwide brand. The people you hire, the way you manage the business, and more factors will determine your success.
Plus, money won’t come in fast enough for you. It will still take time before you see returns on your investment like any other business.
Misconception #5: You Should Choose a Franchise Based on Your Passion
They say that if you choose a job you love, you won’t have to work a day in your life. That may be true for some people, and if this is viable for you, then go for it. It’s not possible for other people, though, but don’t let that discourage you.
There are many businessmen who are successful because they didn’t choose a path based on their passion and past experience. Rather, they chose an opportunity that allows them to chase the lifestyle they’re seeking.
Choosing a business based on what you love will only limit you. This might cause you to ignore the countless other opportunities for you. Plus, take it from others who made this mistake: you might end up hating your passion since it would then feel like a chore.
With that said, don’t limit yourself to the opportunities that require what you already have. You can always learn the skills needed for other opportunities, and those may be what will allow you to grow and succeed.
Choosing the Right Franchise for You
The right franchising opportunity for you won’t come to you-you have to look for it and then study each one to see which will allow you to grow. Still, it’s never a bad idea to have some preferences in where you want to go. If you’re looking for a professional cleaning company, for instance, talk to us today.