When you are thinking about branching out in the business world, a lot of future owners are faced with one decision. Is it better to buy into an already established franchise or start your own business?
To answer this question, you have to know what your goals are as an owner. Both being a business owner or franchise owner have positive and negatives.
Take a look at the differences between starting a business vs. buying a franchise:
The idea of opening a brand new business can be intimidating for some people. Others thrive on the idea of having their hands in every detail. The decision to open your own business is best for those who are breaking into a new field where the market is not over saturated or where the idea has not been done before.
When you open a new business, there will be so many decisions to make, from hiring a contractor to making the business plan. You are able to hire the employees that you want and can follow your own set of rules. Starting a business from scratch is best for those who want to be part of each aspect of the company. People who have the time, money and ability to be there every step of the way can get a great return. Opening a business or company is really the time for you to put all of your dreams into place and watch them come to life.
However, as amazing as starting a business from scratch sounds, there are some nerve-wracking aspects of owning and starting a business. The main reason is that you are doing it on your own. You, as the business owner, will have to make the correct decisions that will get you more customers which means you can make a profit. Choosing paint colors and light fixtures might be your breaking point, for others location or a business name might be enough to stump them for months. Besides the possibility of making the wrong decisions, all of your own money is on the line. If you make a mistake, it is solely on you.
A franchise is “a business in which the owners, or “franchisors”, sell the rights to their business logo, name, and model to third-party retail outlets, owned by independent, third-party operators, called “franchisees”. Franchises are an extremely common way of doing business.”
When you sign up with a franchise, you exchange money for everything from a business name to training your employees. The franchise is there to help you succeed! A franchised company is most often something that customers know about or have been to before. This helps get your customers in the door, helping you turn a profit!
The negative aspects to a franchise is that as you make money, you have to continue to pay a portion to the franchising company. This cuts into your bottom line. You also have very little control over major decisions in the company. Many things are not allowed when you are part of a large corporation franchise.
Do you know where your business is heading? To learn more about how we can simplify your accounting process, call us at 727.828.9945 to schedule your free consultation.
About Accounting & Business Partners
Accounting & Business Partners is a CPA firm with an efficient bookkeeping department. We believe that success lies in numbers. However, the drive behind the numbers is what truly matters. That’s why we look beyond the financial statements.