If you’re thinking of starting and growing your own business and have a creative bent,…
Want to own your own business but you’re concerned about the startup costs of opening a shop? You don’t have to start from scratch. Franchising makes it easier for business owners to expand their careers without breaking the budget.
Let’s compare the overhead startup costs of opening a small business versus those of opening a franchise to help you determine if franchising is right for you.
Overhead Costs for a New Small Business
When you’re ready to open your location, you’ll need a certain amount of capital to rent a property, order equipment, hire and train staff, and begin accepting customers.
You’ll also need to hire contractors to provide landscaping, window repair, a new coat of paint or anything else you may need to improve curb appeal.
The cost of this initial investment will fluctuate from business to business, ranging between $250,000 and $1.5 million.
Overhead Costs for a New Franchise Business
Unlike starting a new business from scratch, purchasing a franchise allows entrepreneurs to work within a pre-established framework, marketing strategy and brand.
This can save owners a lot of money, both during startup and as your franchise location grows. With a franchise, your parent company will help you source equipment and outfit you with everything you need to run your store well.
You will need to pay a one-time franchise fee and demonstrate a certain amount of liquid capital, but you won’t have to invest a tremendous amount of resources into machinery, renovations or other projects many small business owners must contend with.
A monthly fee will likely be due to the company that owns the franchise, and a monthly percentage of sales or a flat base rent must be paid to the owner of the building. Hiring a new staff is also your responsibility, assuming the location is not already staffed when buying a franchise.
Franchise Businesses Can Mitigate Risk
Many entrepreneurs agree that buying a franchise is much less risky than starting a completely new business outright.
For one thing, the brand you are promoting has already been long established, ensuring many customers will visit your location knowing exactly what they want and what to expect. Not only that, you can expect financial and managerial support from the corporate office when you’re in need of assistance.
The challenges entrepreneurs face when opening their own small business are daunting, but many issues are easily alleviated by investing in a franchise instead. Protect the capital you’ve accumulated, enjoy less risk and get a running start on profits with a trusted, established franchise name today.
To learn more about how franchising can help alleviate business startup costs, visit our website today.