However, another viable alternative is to buy a franchise, as start-up help, support and training are provided with a franchise business opportunity. Many see franchising as a way to help increase their income and improve their lifestyle, and as a result, many people are dipping into their savings or pensions and investing in franchises.
Should You Buy A Proven Business Model
The experts suggest that you should consider purchasing a proven formula. An existing franchise that is doing well will help you avoid many of the major hurdles or problems that may exist if you were to open a business from scratch. That is where having the good franchisor comes in.
Everything is already in place, from branding to marketing to the selection of good vendors, versus starting up a business where you will very likely not have an immediate income stream.
Why Bigger Is Better
If you think you are ready to buy a franchise, then consider getting in with a large chain, as often times they have in-house assistance or financing for some or even all of your start-up expenses. This will help to avoid having to find a franchise loan. These companies tend to focus more on you as the buyer and what you can bring to the company.
Even if they do not offer their own financing, many times they have a relationship with a lender, which will make it easier for you to qualify.
Make Sure Yo Get The Right Loan If Additional Funds Are Needed
However, if you do have to secure a loan, then keep in mind that obtaining a SBA loan is usually a good idea, as they offer longer terms at competitive rates. If you are buying a franchise, then your loan application may be looked at more favorably as they tend to be a safer bet for the SBA.
They also have a list of franchises that have already been reviewed, which allows them a much quicker response time when you are waiting for an approval.
Many people will buy a franchise so that they can be the boss, run the show and call all of the shots, yet the franchisee must also know how franchising works. You do own one unit but you also agree to follow the company rules, or formulas, that are in place.
Doing this also allows you access to the franchise support system, thus giving you a better chance of making a success of your investment.