Start a Business or Become a Franchisee?
Posted on 21st January 2022 at 10:33
If you are looking to start a business, an important consideration is whether you want to start from scratch or whether to purchase a franchise.
Becoming a franchisee has many benefits – one of the main ones being that you benefit from all the costly mistakes the franchisor has undoubtedly made along the way to a successful business – so that you don’t repeat them. This reduces the chance of failure as well as the time to reach profitability – which are two of the key reasons why banks are supportive of franchises.
We spoke to Kevin Brent, founder of BizSmart, to find out more about the pros of purchasing a franchise, and what it takes to become a franchisee.
WHAT ARE SOME OF THE BIGGEST BENEFITS OF BECOMING A FRANCHISEE?
“Becoming a franchisee is a great way of building your own business whilst minimising the likelihood of failure. When you become a franchisee, you get all the benefits of building and running your own business combined with a support network. Essentially, you will have a blueprint for success and help where you need it to build your business – so you have independence but you are not on your own.
“The franchisor will already have built a credible reputation – even early stage franchises will have a network of clients and built credibility around the brand. This will have taken time and money to build, so another significant benefit of owning a franchise is that you benefit immediately from that reputation.”
WHY IS BECOMING A FRANCHISEE A GOOD ALTERNATIVE OPTION TO STARTING YOUR OWN BUSINESS?
“The idea of becoming a business owner can be very appealing but building your own business from scratch is no easy feat. Choosing to become a franchisee allows you to realise your dream of becoming a business owner without doing it alone. In most cases, franchise business models offer training, guidance and ongoing support to help build your business, as it is in the franchisor’s interests that you succeed.
“Franchises are also well known for having much higher success rates than start-ups. In a survey carried out by the British Franchise Association and Natwest, over 90% of all UK franchisees reported profitability within their first year. That is because the business model used has been tried and tested over time. Whilst there are never any guarantees of success when starting your own business, a franchise provides an effective blueprint for a successful business that can be replicated.”
WHO IS THE IDEAL CANDIDATE TO BECOME A FRANCHISEE?
“That really depends on the franchise, but to succeed in any franchise you need to have a proactive rather than reactive approach combined with a strong work ethic. Having a blueprint does not mean you will succeed without hard work! You will still have challenges that you need to overcome, and you will still be responsible for making the model work.
“Leadership skills and experience in managing and motivating a team are important in any franchise where you will be employing staff. Those who have experience in leadership and management in a successful, growing business also make great candidates as they have been exposed to the inner workings of a well-established business.
“Some of the main qualities we specifically look for in a franchisee include personal honesty and integrity – a genuine individual with credibility who easily builds trust with people. For us this is absolutely paramount. We also look for proactive, positive people who have a natural curiosity and desire to help others succeed.”
WHAT DO YOU THINK ARE SOME OF THE MOST COMMON MISCONCEPTIONS ABOUT PURCHASING A FRANCHISE?
“People often think that purchasing a franchise is expensive, and it’s cheaper to start your own business from scratch. From my own experience, I can confirm this is definitely not true! It has taken us eight years to get our business model right and we have invested far more into the business than the cost of the franchise fee.
“Arguably, one of the biggest misconceptions is that the franchisor will build the business for you. Although the franchisor does set up a selection of frameworks and systems for your franchise to work within, it still requires you to build and develop the business yourself – and you will reap the rewards accordingly.
“Another misconception is that investing in a franchise is a passive form of income. This is far from the truth, especially in the early stages. To become a successful franchisee, you need to be willing to work hard in order to set the foundations and drive its growth.”
DO YOU NEED TO HAVE ANY PRIOR BUSINESS KNOWLEDGE TO BECOME A SUCCESSFUL FRANCHISEE?
“It truly depends on the franchise model. For most franchises, having previous experience working in a well-established business at managerial level will aid your success as a franchisee and provide you with the foundation knowledge to run your own business. It is much more important to have the right attitude than to have specific knowledge, as the franchisor will provide the specific training you may need.”
YOU RECENTLY LAUNCHED THE BIZSMART FRANCHISE MODEL – WHAT PROMPTED YOU TO DO THIS?
“We are on a mission to increase the number of scaleups in this country, and we launched the BizSmart franchise model to be able to support more owner managers.
“Over the last eight years we have developed and proven our business model which has recently been endorsed by the Scale Up Institute, and we are now looking to extend BizSmart’s support to more businesses in all areas of the UK through our franchise model. However, we are very selective about who we are looking for – maintaining our reputation for professionalism and impact is key to us. We would rather scale slowly in the right way than rapidly with the wrong people!
“The numbers show that only 4% of business owners are able to scale past nine employees and we aim to change this for those owner managers that want to scale. By expanding the BizSmart brand through franchising, we can offer owner managers across the UK our tried and tested support through local credible businesspeople.”
WHAT DOES THE BIZSMART FRANCHISE MODEL HAVE TO OFFER POTENTIAL NEW FRANCHISEES?
“Having delivered our own successful business support programmes, supporting hundreds of businesses, we have seen the incredible impact it can have in helping business leaders create a clear and consistent strategy for growth – leading to greater business success and fulfilment.
“The BizSmart franchise model offers a highly rewarding way to build a business. It is incredibly inspiring to look back at where some of our clients started in comparison to where they are now. It is a great feeling knowing that their growth is partly due to our help and support.
“Being part of the franchise will also help franchisees gain a respect amongst local business owners and to become a trusted and valued member of the local business community. Our franchisees will be seen as the ‘go to’ person and rapidly become a trusted source of advice and support.
“Our business model overcomes the key challenges of building a successful ‘consulting’ business, supporting owner managers of small and medium sized businesses. It enables franchisees to add tangible and significant support to businesses at a fair investment from them, whilst enabling franchisees to build a sizable profitable business themselves.”
WHAT ARE YOUR PLANS FOR THE BIZSMART FRANCHISE IN THE NEXT THREE YEARS?
“We plan to build an exclusive network of 10 strong franchisees over the next three years. We are looking for the very best people who want to play a key role in our mission to disrupt the market and provide real value to owner managers.
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