There are many reasons why franchising is gaining popularity among entrepreneur moms – they can pursue their area of passion and venture into an enterprise with all the structures in place.
By learning how franchises work and the potential they portend, entrepreneur moms can explore the possibilities in franchising depending on their competence and interest. However, for many moms, the question that lingers is, “What’s the most profitable business to get into as a franchisor?”. We’ll look into all that.
What Is Franchising?
Franchising is a business model involving a franchisor who establishes a business system and a franchisee who can do business under the franchisor’s brand. The franchisor usually pays the franchise an initial fee to do the business and pays royalties to trade using the franchisor’s business ideas and model.
Pros And Cons To Franchising For Moms
Like any other business, every mom needs to know the pros and cons of franchising before signing any deal.
Pros of franchising
Lower failure rate
Investing in a franchise is like taking the shortcut to start up your business by plugging into an already successful brand. As a franchisee, you’ll be buying a brand that has a proven track record with products that are already in demand. That means a lower likelihood of failure compared with starting your business from scratch.
As a franchisee, you’ll benefit immensely from the franchisor by the valuable advice and a “tested-and-ready” system that essentially makes franchising a turnkey operation in many instances. Once you acquire the franchise, you get the necessary supplies, equipment, instruction manuals, management, and marketing support for your outlet.
The grueling journey of organically building a brand takes time, experience, and resources. With a franchise, you bypass a lot and present your customers with a recognizable brand that they can trust. This makes it easier to get customers streaming in and making purchases even if you’re virtually unknown as a franchisee.
As a franchise, you benefit when the parent company enjoys discounts since they buy in bulk given the sheer size of its network. For a solo business, it’s a tall order to match the bargaining power of a national brand that purchases massively. When inventory costs less, you’re looking at lower operating costs and enhanced profit margins.
Popular franchises command a decent market since they’re known brands with a loyal customer base. Despite having a high initial purchase price, they’re likely to yield a high return on investment (ROI).
Cons of franchising
When you opt to invest in a franchise, you’re bound by the rules and regulations of the agreement. Some franchisors may be so restrictive that you lose the essence of being your own boss.
They may dictate the opening hours, signage, layout, and location of premises. That’s because franchises aim for a standardized experience for their customers wherever they’re served.
If you plan to run a recognizable franchise, then be prepared to cough up some decent bucks upfront. Even the not-so-known brands would still present a cost for the initial acquisition. You can pursue small business loans and franchise financing options to fund your initial budget.
After paying up the initial costs, a portion of your revenue will be paid to the franchisor monthly, being royalties, as per your agreement. You may have to bear the parent company’s costs for running advertisements, training services, and digital interconnectivity.
Loss of financial autonomy
When you run a franchise, financial privacy is a luxury you may not enjoy as the parent company is looped into the financial going-on at the franchise.
Most Profitable Business In Franchise For Entrepreneur Moms
Many entrepreneur mums have found some of the most profitable businesses by buying business franchises in the following niches:
- Gyms and fitness centers
- Health spas and massage services
- Reading centers
- Home gardening services
- Fast food restaurants
- Coffee houses
- Jewelry stores
- Home and office cleaning services
- Child daycare centers
Franchising presents an excellent business opportunity for entrepreneur moms to be financially independent and be their own bosses. Regardless of the level of exposure, moms with an entrepreneurial spirit can find a fitting business franchise that they can buy and run profitably.
Published at Fri, 22 Oct 2021 02:52:47 -0400