One of the basic ingredients of business success is to literally and figuratively know the ins and outs of the trade one is engaging. This means that one should eagerly know what he or she is getting into and this includes the many myths and misconceptions that is attached to this pursuit and is believed by many. Exploring these misconceptions is a great start so you can check on your own if these are true or not.
As it is defined, a myth is any invented idea or concept with or without a determinable basis of fact or a natural explanation. Misconception on the other hand is a mistaken notion or an erroneous conception. The franchising concept despite its gained popularity among many entrepreneurs is also not spared of these unreasonable misconceptions.
However, as a keen capitalist, these concerns should also not be taken for granted as these might ‘hit’ the business indirectly along the way. The best manner to face all of these is to sit down, see things in perspective and seriously check where these misconceptions are coming from. In this way, there is an assurance that if you wanted to pursue franchising, everything is laid down crystal clear and whatever the result is, there is no one to be blamed. See the list below and check these things for your own good.
Easy Money.
Oh come on. Franchising is not a walk in the park scheme on how to get rich quickly. Although, experience and fact may tell that the chances of generating income is relatively much higher in franchising as compared to a start-up, franchising is definitely not a guarantee that money comes easy. There are a lot of factors to consider and one of it is commitment to the business and establishing your strategy in making decisions. This is the meat of the matter and so if you do not put 100% of your effort, time and resources to this, then surely failure is just around the corner.
In the Long Run, the Franchise Can Operate on its Own.
How naive can you be? To believe that the franchise can run even without a leader on board is the most irrational belief and misconception in the business community. Franchising in a nutshell is basically a partnership and this means that you work together to bring everyone up to where it is supposed to be for as long as you are bounded with the franchise agreement. So, achieving independence in this case is actually doing the business on your own with the guidelines, goals and directions set by the franchisor.
The role of the franchisee is to implement and follow where the direction is going for the company in general and the brand in particular. Thus, in the long run, the partnership is strengthened and success is expected. It will never stand on its own as a separate entity.
The concept of buying a franchise.
There is a huge difference between investing and buying. To make it clear, if you want to have a franchise on something, you do not buy the franchise but instead you invest on the franchise. This means that you are spending on the franchise business method to get permission to utilize a brand name, system of operations and other support scheme for a certain period of time as stated in the contract both parties agreed upon. Buying on the other hand is exchanging of goods and services and no contract or agreement is binding after the sale has been made. Each is independent with each other. This is the difference between the two ways of looking at what is a franchise.
It is a one-time deal.
This also brings the possible franchisee to a false impression of how his money will be utilized if he invests in a franchise. Engaging in a franchising agreement between the franchisor and the franchisee is a continuous partnership, thus expenses and other fees along the way are expected to arise in the course of the business. Franchising is not a one-time investment deal as popularly known. Unforeseen expenses do happen and will happen before, during and after the contract has been signed. Bear in mind that franchising will need time, resources and most of all a huge deal of capital infusion from time to time as long as it is running.
Franchising is only for the food industry.
This is definitely a false claim to anyone who wants to own a franchise. The opportunity for any business is so vast and franchising is not excluded in this description. Although the food and restaurant industry are the popular items for franchising, this is not the only things you can franchise. If you are not a foodie yourself, then there are a lot of options to choose from. The growing service industry is one and is even a better fit to those who want to be adventurous in its venture.
The horror of litigation.
With the increasing knowledge of customer rights and privileges, the rise of lawsuits against these big franchisors and even franchisees has become a trend in the business world. However, as what they say, these are inevitable. The best way to deal with this is to put priority in customer service. Awareness, proper education and good training are the tools that will not put your business in jeopardy. Invest in people, hire a good consultant and get the best lawyer in town. In this way, you will not encounter horror in litigation because of that one single fly seen in the juice of your valued consumer.
Franchising is so expensive.
This is the general knowledge but if you research your pieces very well, there is a lot of affordable food stalls franchise waiting for you. The franchise is just very reasonable and practical in amount that even a regular 8:00-5:00 employee can afford to have and make this business on the side.
So, if you are in a business dilemma of engaging in a franchise, it is best that the different concerns and issues have been thoroughly looked into. The misconceptions mentioned above are the popular ones. Check out other information so you get the whole picture. And when you get to decide, you know what to expect.