Myth & reality of franchise business

The world over franchise business is being promoted as a safe and profitable business, with very high rate of success, compared to independent small businesses. However, the fact remains that the success rate of a franchise business depends on franchisee to franchisee. 

Among the many myths surrounding the franchise business, the first and foremost is that it’s a safe, risk-free business. Prospective franchisees should not develop any misunderstanding that franchising is a sure recipe for success. They should not get into this business merely on emotion and gut feel. Rather, should take an informed and careful decision before signing a brand. 

A prospective franchisee should carefully study the franchise model and go for the one which is easy to manage and where there is strong support from the franchisor. One must clearly understand that the success of franchise system depends on the efficacy of the franchise system and how religiously one follows it. Feedback from existing franchisees of the brand will give prospective franchisee a fair idea about the success of the franchise system. The success or failure of any franchise business depends a lot on the franchisee. If a weak or unsuitable franchisee without any interest or knowledge of a particular category of business gets into the franchise system in the absence of a relevant selection criteria or procedures, surely, it’s a weak foundation for that franchisee business. 

Many people get into franchising, holding a myth that anyone can make a success of franchise business and that they can make good money in short time by putting in lesser amount of efforts, compared to independent business. If you get into franchise business on this wrong promise and with unrealistic expectations, you are bound to tread on a risky road that may not lead you to success. 

Those desirous of getting into franchise business should be fully aware of its pitfalls. They must realise that like an independent business, they require sufficient working capital with family and social support. 

Another significant aspect of franchise business is that the prospective franchisees must have interest in their line of business and possess temperament and skill to engage with the team as well as with customers. Those having strong independent personality/outlook, may not fit into the franchise culture/system. If they want to make success of their business, they will have to learn to make adjustments. They should also have patience to build on the business. Before getting into franchise business, one must realise that his relationship with his franchisor is the key to the success of his venture. And the success of his business will depend on how well he manages this relationship. 

Business acumen is an important asset of a franchisee. And it surely adds to the chances of success in business if the franchisee has previous experience of running business. Work ethics, organisational and leadership skills and customer-focussed approach with the ability to communicate and network are the assets of a successful franchisee. 

In short, with business minded approach, constructive franchise relationship and vision for the future of his business, an entrepreneur can make his franchise business successful.