For decades now, franchising has offered individuals a chance at the American Dream. Whether in response to a dead-end corporate job, fear of being laid off or downsized, or simply in response to the entrepreneurial pull that burns in so many of us, generations of Americans have turned to franchising for the independence and financial fulfillment it provides.
As a franchisee, you purchase the rights to use a brand or name in a given location or area. Your job is to open and operate that franchise unit to the best of your ability.
A Proven System
One of the key beauties of franchising is that you can remain independent while you tap into a proven, well-oiled business machine and all that it offers. There’s no need for you to create a product or service, no need for a proprietary business plan, and in most cases, no need to initiate marketing and advertising plans. The franchisor has already done all the work for you. And successful franchise concepts have been tried, tested, and tweaked to perfection — and are backed by money, management, infrastructure, and an effective distribution system. What works on the East Coast will work on the West Coast — and everywhere in between.
Economies of Scale
The economies of scale created by the franchisor are available to all franchisees. That’s something that you won’t find when starting your own business, perhaps ever. There’s power in numbers.
So how do these economies of scale benefit you, the franchisee? To begin with, a franchisee can typically purchase goods and supplies through the franchisor at a discounted rate — everything from cleaning supplies and uniforms to food products and ingredients. Franchisors that purchase products and services for their franchise network have the ability to negotiate significant volume discounts from vendors/suppliers. The end result is a competitive advantage that results in higher operating margins for each franchisee.