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Which to choose? Franchise Business or Self Employment

Written by: Nick Strong

Article Overview: Many people are looking at the option of working for themselves, whether it be as a result of redundancy or just wanting a change in lifestyle. We look at pros and cons of going it alone with self employment or buying a franchise business.

Which to choose? Franchise Business or Self Employment

A popular topic at the moment seems to be “Whats the most suitable choice for starting up my very own business? Self-employment or buy a franchise?”. These are usually people who find themselves out of work due to redundancy or lay off, or still in full time work and simply desiring a change of way in their working life. So which are the advantages and disadvantages of self-employment when compared to a franchise. Both options do symbolize a way of working for yourself in view of the fact that whether you develop a business according to your own personal idea or buy a franchise opportunity, you'll still essentially own the company and will be responsible for whether it succeeds or is a failure. So here are some of the key differences:-

Self-Employment

Pros

1. All takings are yours to administer.
2. You get to work to your own ideas and discover a structure that works for you.
3. Fulfillment in knowing that you are building a company for yourself, in your own personal way.

Cons

1. Its well-known that self-employment in the UK has a high breakdown rate with approximately 4 out of 5 companies failing inside 3 years.
2. You are going to be building up a brand and reputation from scratch.

A Franchise system

Pros

1. The NatWest/BFA annual survey consistently reports around 90% of UK franchisees are operating profitably every year. Other countries have comparable statistics on franchising.
2. You are working to a business system that ought to have been tried and tested by a franchisor.
3. Most franchisors provide training and support backup.
4. The franchise opportunity could have established branding and popularity which you would possibly benefit from.

Cons

1. There will often be an upfront franchise fee in order to provide setup and training costs.
2. A number of franchises for sale charge recurring franchise management fees (usually a percentage of earnings or profit) that cover ongoing training and backup.
3. You will often have a contractual attachment to the franchisor for as long as you operate the franchise business.

These are really just the main points as there are other points. Whichever preference you pick out its important to observe that taking on a business requires determination, devotion and a a good amount of hard work!

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  Wanting to start up a Work from Home Franchise Business?

Article Tags: business, franchise business, franchise opportunities, self employment, work for yourself



Related Forum Posts
Re: Enticing Franchises - Top 9 List - All Franchise listed above are in millions of dollars. Do you have the list of Franchise in thousands
Re: Info for would be franchisers... - [quote="Sebastien":1d29sdv1]Like Franchise Times, Franchise Update is a very practical magazine. There is no blah blah, just straight facts that anyone in the franchise community can relate to. I just want to mention that all these magazines are NOT franchisee oriented. I mean these magazines are for franchise professionals. If you're looking to buy a franchise, you won't find much information in there. To answer your question, getting published in Franchise Times was fairly easy. I don't want to brag too much but I think I am known in the franchise industry. I was the marketing guy at Franchise.com for a few years before joining my new company, the World Franchising Network. So people know me and I have a very good relationship with Nancy Weingartner, the Managing Editor at Franchise Times. I was talking with her at the last Franchise Expo South in Miami and she mentioned she'd like me to be profiled. I was like "ok, sure!". I like this franchise executive profile thing in Franchise Times as it is rarely BS. People are usually really natural in there.[/quote:1d29sdv1] Thanks for the follow up Sebastien! And I can't say that I'm surprised that networking with the right people and managing your relationships with them properly are the keys to being published. I guess the old adage holds true of "it's not who you know, but who knows you" that's important.
how much for a franchise fee? - Dear Colleague There is no easy answer to this question. Things to consider: [list=] The sizeof the Franchise Clent base Expected Turnover Intellectual Property costs (recoup) Number of Franchises Number of employees Original Set up costs Franchise admin costs An example: A franchise that I was involved in setting was to a simple "lawn mowing/home repair" franchise. The Franchise included national/local advertising - preparation of client lists - general admin - central accounting etc The Franchise involved 300-500 clients - and an annual turnover of about $300,000 . The annual franchise fee was $30,000. Hope that this gives you some idea Take care Ian[/list]
Fed rate cuts . . . - So just what do the newest Fed rate cuts mean to Franchise and Business Opportunity investing? Is it immediately felt? What timeframe do you think, or rather, where are we in terms of new vs. existing business investment? A similar question can be composed for the economic stimulus checks - will they a have any effect if consumers spend a little $$
Re: Hello EvanCarmichaelers, and Thanks! - "Carmichaelers" ..nice.. Over at the Young Entrepreneurs I'm going to start calling my readers "DSilvelers" - I like the sound of that! Welcome on board theFranchiseMarket. Do you run a Franchise Business or are involved in Franchising in anyway?


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