Reasons Why People Buy Franchises
In a sense, franchising is a business model whose primary purpose is to reduce risk. Every study ever done on the success rate of new (non-franchise) business startups concludes the same thing. Starting up a new business is very risky. Most studies show that over 90% fail within three years. The primary reason that the failure rate is so high is because the owners have to go through the learning curve of operating that specific type business.
Unfortunately, the market place is not very tolerant of the inexperienced operator trying to learn how to run a new business. If you can’t compete in the market place, you get eaten by the sharks very quickly.
Unless you have considerable experience in the specific type business that you are considering going into, it is very probable that you will fail. All the studies done have found that new franchise business startups rarely fail and when they do it is typically because the franchisee did not stick to the franchisor’s systems.
People buy franchises for a lot of different reasons and some of them are:
- More flexibility in their day
- More control of their lives and careers
- A better work vs. life balance
- Greater personal and professional challenges in their lives
- Retired and looking to continue a productive live; supplemental retirement income.
- Giving back to their community or making a difference in the lives of others
- Financial gain
The great sales trainer, Zig Ziglar, said “People don’t buy drills, they buy holes”.
The same can be said in the world of franchising. People should not be buying franchises; they have a need or a problem that needs to be rectified. Buying a franchise may be the solution for that need or problem. You, the prospective franchisee, should delve into the reasons you want to buy a franchise. Once you are completely aware of the reasons that you want to buy a franchise, then you can explore specific franchises that matches your needs.
For instance, if you are looking for more flexibility in your day and you want a better work vs. personal; then opening a food franchise may be the wrong decision. Typically food franchises require a heavy work schedule, plus you will be open on weekends, holidays and evenings. The result is the franchise that you looking to buy did match your needs. You probably would not have been happy for very long. The Franchise Search Group can assist you in avoiding this result and save you both time and money.