If you asked me whether to invest in a franchise unit or other business, I would definitely answer franchise unit.
For me this is a no brainer – Franchises thrive because of something “organic” they have that any other business types don’t. Franchise opportunities are being offered without showing signs of slowing down – a good sign of recession-resistant business type.
What Franchises have that other business types don’t
Franchising embraces the power of number. Even a 10-unit franchise opportunity is way much, much stronger than its stand-alone or multi-unit non-franchise counterparts.
Ten heads are better than one – Having business owners teamworking, pursuing ways to secure their franchise units away from recession is the best thing with franchising.
Combine that with the inherited benefit of a franchise – proven business system, industry knowledge and the buying power – there is probably no business opportunities better than franchise opportunities.
Is franchising recession-proof?
I won’t say franchising is recession-proof, but I do say that franchising is recession-resistant.
Can you fail with franchising? Of course. How likely you will succeed with franchising? More likely than other business types.
These days, there are no better business opportunities than low cost franchise opportunities.
What low-cost franchise opportunities can offer you
Recession can lose you your job. However, getting downsized and made redundant is probably the best way to get into entrepreneurship. While looking for another job might be very difficult and even if you do get one, it might not give you the same job satisfaction and salary you had with your previous employer, entrepreneurship is probably your best option to take.
Recession can also lose you your business. If your problem is failure due to too much trial-and-error (this is my case :P), franchising could be your best bet, as it offers a tested-and-true system that will eliminate the majority of your trial-and-error headaches, and let you focus what’s important – grow your business.
You might say, “Well, all look fantastic – But losing a job or a business means I don’t have much to support myself, let alone to invest in a business.” My answer is this: Entering franchising is made easier by the presence of many low cost franchise opportunities.
The main benefit, of course, is the low investment, with low barrier to enter. You can learn entrepreneurship along the way (although entrepreneurship mindset is a prerequisite), with the guidance (often, too strict for my taste) from the franchisor.
What should I do now?
The first and foremost step: I highly recommend you to seek information on franchising, NOT on franchise opportunities.
Why? Because starting out in franchise business demands a certain set of skills and mindset. One of them is your ability, as an entrepreneur, to be creative under a strict guidelines that govern how franchise units are (supposed to be) run.
The second step is the fun part – looking for franchise opportunities. As a guideline, you should first decide how much you will invest in a franchise unit. An investment-intensive franchise unit can be rewarding, but achieving break even point could take a longer time than you expected. On the other hands, investing in low cost franchise unit can haste your break even point, but with a lower income potential than the high cost counterparts.
The choice is yours – but in my case, I would prefer investing in a low cost franchise unit. I can always replicate the success with multiple units in multiple locations, while spreading the risks of business failure.
Ivan Widjaya
Franchises beat recession
Image by NNECAPA.