Ultimately, you have to be the one to decide what kind of business model works for your specific interests, personality, and passions as well as your own financial obligations, financial resources, and future goals. Carefully considering exactly what you’re getting yourself into will allow you to be much more successful than someone who jumps in without fully understanding what it means to be a business owner or franchisee.

1. Weighing the
Pros and Cons
of Franchising
By Neil Burnard
Buying into a Franchise vs Starting Your Own Business
NB
www.neilburnard.com
Network Development Head of Continental Europe
for Expense Reduction Analysts
and
Managing Partner of
Master Franchise Connections

2. Going into business for yourself is a
major life decision that comes with
a lot of choices.
- You can start your own business,
- buy an existing one, or
- buy into a franchise.
Each comes with it’s own unique
benefits and inherent risks.
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com

3. Pro:
When you’re starting out, no one knows who you are. A huge pro
of franchises are the fact that they come with built in brand
awareness. Right when you open the door, you’ll have fans and
you’ll have haters. The point is, people will already know who
you are and be ready to buy.
Con:
You’re buying a brand, which means you don’t get to create,
define, or alter it. For creative types, this can be a big deal
breaker, as creating a brand can feel like a huge part of what
makes their job engaging.
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com
Brand Awareness

4. Pro:
With a franchise, you still get to control the day to day
operations of your unit without having to figure everything out
on your own. You’re the boss, but you also have resources from
your franchisor.
Con:
When you start your own business, you get to control every
detail, large and small. While the responsiblity is huge, it also
means you can make changes and updates on your own accord.
As a franchisee, you’re agreeing to follow the guidelines laid out
by the franchisor. You’re contractually obligated to follow
someone else’s rule book (a rule book that has proven successful,
but not one you created or control.)
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com
Control

5. Pro:
When you start a new business, there’s no telling if or when your
concept is going to actually work. With a franchise, you’re buying
a tested and proven business model. You’re essentially getting a
“plug and play” business. Just follow the operating manual, and
you’re golden.
Con:
While figuring out each step on your own can be difficult and
unpredictable, if you enjoy creating things from the ground up,
innovating on processes, and adapting as you learn, this can be an
engaging and even thrilling experience. It might take longer to
get things off the ground, but it’s also arguably the most creative
part of the business process.
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com
Learning Curve

6. Pro:
Outfitting your new business with the proper supplies,
equipment, and suppliers can be both timely and costly.
Franchisors are an invaluable resource for buying exactly what
and how much you need, right from the get-go. You’re franchisor
can also negotiate bulk rates and pass along the savings to you,
and having the power of a recognized brand behind you often
eases the mind of suppliers in extending credit.
Con:
Usually what you buy is dictated by the franchise, so again,
there’s not much room for adding any “personal touches.”
Equipment, menus, uniforms, and store design have to fall under
existing brand guidelines and supplier agreements.
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com
Equipment & Supplies

7. Pro:
Most franchisors won’t supply financing, but they have existing
relationships with lenders who will view a brand referral more
favorably than a first-time independent business owner.
Con:
Starting your own business can cost less up front than buying
into a franchise, depending on the nature of the business and
how much you decide to put into it. Entrepreneurs often get by
on a minuscule budgets starting out and still succeed.
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com
Financing

8. Pro:
If you’re a franchisee, most likely your brand is already backed by
big marketing and advertising (regionally if not nationally). If
you’re a new business owner, you’re on your own.
Con:
As a franchisee, you will probably have to contribute monthly to
that big advertising fund, but at least everything is already in
place.
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com
Marketing

9. Pro:
Introducing a new product or service that flops costs business
owners both time and money. When franchisors develop new
products, they’ve usually been thoroughly tested by other stores
and iterated on to ensure that it’s a valuable offering. While it may
cost franchisees some money to install new equipment or
introduce a new store design, ROI is relatively more guaranteed.
Con:
You may not like every new product or service that gets
introduced. You might feel like you have a better idea that you
can’t implement. It may come at a time when your location is low
on funds. You don’t have much of a choice when it comes to how
the franchise evolves over time.
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com
Product/Service Changes

10. Pro:
It’s especially important when buying into a franchise to make
sure your goals and values align with your franchisors. If you’re
on the same page, you can have a positive relationship that helps
you and your business thrive.
Con:
When you own the business, the only person you truly have to get
along with is yourself (and hopefully your customers and
employees.) You’ll frequently hear franchise experts describe the
franchisor/franchisee relationship being like a “marriage.” Like
any marriage, if the relationship sours, it can create a miserable
situation for everyone involved.
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com
Culture / Fit

11. Pro:
With a known brand, your pool of potential buyers is much larger
than a small, relatively unknown business. If times are tough and
you’re having trouble finding a buyer, there is always one
guaranteed buyer (the franchisor) who can buy back your unit
until they find a new franchisee.
Con:
Selling an independent business can be much more lucrative. But,
your pool of buyers is generally smaller, and if things get really
bad, you may not be able to find a buyer at all.
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com
Exit Strategy / Resale Value

12. Speed to market - With a franchise, you are given a list of exactly
what you need to open. No research, returns, or bad purchases
necessary. This means you can open and start making sales much
more quickly.
Faster ROI - There’s no telling how long it will take a new brand to
build up the reputation and client base it needs to turn a profit.
When you’re working with a known brand name, a customer base
comes built in, which means you can reach a profit more quickly.
Training - One of the greatest benefits of being a franchisee is that
you always have a go-to resource for how to improve your
business. Franchisors provide extensive training in every aspect of
their business as well as ongoing advisement for growth. You don’t
have to figure it all out on your own.
Buying into a Franchise vs Starting Your Own Business
www.neilburnard.com
Other Pro's to Keep in Mind

13. For more information
about franchising, please visit
Neil Burnard's website for
Master Franchise Connections
at
www.neilburnard.net
By Neil Burnard
Buying into a Franchise vs Starting Your Own Business
NB
www.neilburnard.com
Network Development Head of Continental Europe
for Expense Reduction Analysts
and
Managing Partner of
Master Franchise Connections