The previously niche model of franchising is employed by more businesses than ever today. In fact, almost any product or service can be distributed through franchising. Anyone who owns a successful business model must definitely consider franchising as an efficient method of expansion.
Franchising has proven to be a successful business model that is suitable for established business owners who want to expand their operations in a shorter span of time than if they had expanded on their own. It is a method of doing business by which a Franchisee is granted the right to engage in the business offering and the selling of products or services under a marketing plan or system prescribed by a Franchisor and is substantially associated with the Franchisor’s trademark, name, logo and advertising, in exchange for a fee.
The following are some tips and guidelines from two perspectives: A Franchisor looking to expand overseas, or an Entrepreneur thinking of investing in the RIGHT Franchise Business.
Key Considerations when entering a Market
After doing the necessary country market research, the next thing you need to do is consider your market entry strategy. Summarised below are Astreem’s 8 Ps as a guideline:
Franchising offers those with an entrepreneurship spirit the opportunity to take up a proven method of investment. Rather than going through the exhausting process of starting afresh, franchising provides investors with a proven brand name and business model to work with right from the start. Bearing in mind that risk is ever present in all investment opportunities, franchising helps mitigate most of the risks. In fact, the only risk franchisees should be concerned about is consumer related volatility.
For existing business owners who decide to set up a franchise, it may also open a new stream of revenue opportunity to them. Depending on the current business model, franchising can even complement their existing business. One example could be business owners who are currently clothing manufacturers. Such owners will be able to establish themselves as distributors (create their own brand name) and eventually franchise their own brands in the retail sector, locally and internationally.
As a potential investor, there is more to simply finding a suitable brand to franchise. Aside from looking for a profitable and sustainable business, it is important that you possess a keen interest in the industry of the particular franchise business. Whilst prior experience in that particular industry is beneficial, it is often not necessary as training and guidance will be provided by the franchisor. As a potential business investor, you should also evaluate your own financial ability and conduct your own market research and market analysis of the brand.
Franchising is a very viable option, especially for first-time business owners. As with all other businesses, it takes time, dedication and effort to manage a successful franchise; the risks of running a franchise are however mitigated with the support and expertise received from the franchisor.
As a novice investor looking to buy a franchise for the first time, it is highly recommended to consider engaging a Franchise Consultant to make an informed decision and choose the correct brand. Franchise Consultants have the experience and the professional knowledge of franchise operations and would be in a favourable position to advise on which franchise would be best suited for you.
Astreem Consulting is a boutique business consulting company that specialises in helping business owners grow their business through Franchise Development, Business Matching, and Branding & Marketing locally and overseas. It is a business solutions platform committed to working with entrepreneurs to build their businesses and enhance their presence in the market
Astreem houses an unrivalled team of experienced strategists and specialists. As the preferred business solutions partner, Astreem offers dynamic programs and market development strategies, covering strategic and tactical marketing, global positioning, public relations, legal advice and business brokering to small and medium enterprises alike.
Astreem offers complete programs which help in developing various business models; what Astreem can do for you is only limited by what you need. For more information visit us at www.astreem.com, email your enquiries to [email protected] or call us at 6749 9233.