When starting out in the cleaning industry, is it best to buy a tried and tested business model of a franchise or go it alone and start from scratch with your own business? In this post we will look at buying a franchise Vs starting a business.
Ding, ding… round 1.
1. Business Model
A franchise is a tried and tested business model that has been proven to work and produce a profitable business opportunity.
Before a business owner franchises their business they have to develop an operations manual on every aspect of the how the business works and operates. The potential franchisor also has to run a pilot scheme whereby they can prove their systems work, independently from the business founder. When buying a franchise you are essentially buying a business-in-a-box. Follow your training and do as the manual says and you should be onto a winner…
A start up business is more for a would-be entrepreneur, who is both willing to take a risk and has a plan for the opportunity of going it alone. A person who starts a business (and wishes it to be successful) must be self disciplined, self motivated and extremely committed. When a start up gets past the initial euphoria of being a business owner and dreaming of replacing Lord Sugar, they need to take five to think about how they will run their business and start documenting it. Think about, what is the process for recruiting? For credit control? For complaint handling? To help, draw upon past experience – what systems did your old employer use? What was good about their office structure and what was rubbish?
Round 2 – Brand Awareness
A franchise will have an established brand. By brand, I mean their logos, colours, marketing etc. will all flow through out their business and have a consistent message and, most importantly, be instantly recognised on any platform. A franchise would have worked with professionals to develop and market their brand.
A new start up business will have no brand. None. Zero. Nada – It is not a crazy dream that a start up can have a brand however, and in this age of technology it’s almost a necessity that you do have one. How are you going to stand out from the crowd if you don’t have a recognizable feature? Branding is a HUGE topic and we will cover this separately in upcoming blogs and videos.
Round 3 – Start Up Costs
A franchise will have an upfront fee that will include for everything you need to be able to start up your business; although in most cases you will still have to buy/own a laptop, printer, filing cabinet etc. The fee you will pay will give you access to the intellectual property (how to guides) and the training you need to run a cleaning business and make a success of it. As a franchisee you will also pay an ongoing monthly royalty fee to the franchisor for ongoing support, updates and training.
A traditional start up business, will have much lower start up costs than buying a franchise. In a start up, you will still need a laptop, printer and filing cabinet etc., but you will not have the upfront fee of thousands of pounds and you won’t pay ongoing monthly fees. However, you will not have a guide telling you what to do and will have to figure out how to run a profitable cleaning business all by yourself through lots of trail and error. Lots of it. If you posses an enormous amount drive, are willing to learn and study the art of business, you too can build a fabulous business to rival any franchisee… Think about this; all franchisors started as business owners right?
Round 4 – Support
A franchise has gotten to be a franchise be proving their business model for a successful cleaning business works. The franchisor would have been there, done it and will own a thousand t-shirts to prove it! In addition to buying the knowledge of the franchisor, when you invest in a franchise, you also buy into their experience and the experience of the network of people that the franchisor would have built around themselves. With a franchise you will have back office support, access to training, access to other franchisees to share best practice and access to expert advice.
With a traditional business, in tends to be just you running the show and having to wear a million different hats to fulfill all roles in your business. However, there are soooooo many great resources out there for you to learn lessons that you can apply to your own business; some of personal favourites include startups.co.uk and all the very awesome Donut pages – Marketing, Start Up, Law and Tax Donut) Other useful tools for small business owners are membership groups like the Chamber Of Commerce or The Federation Of Small Businesses that offer advice, training courses and a network of other business owners all dealing with the same issues.
Round 5 – Success Rates
Now for the bit that matters…
If you do a little research on the internet, you will see claims of; Franchise businesses have success rates of 90% and traditional business a mere 15% chance of making it.
All well and good, except the claims never tell you over what time period the study was conducted, what industry, or what specific franchises were involved in the study. The claims of wild successes can normally be found on franchise websites or franchise led membership sites trying to woo and seduce people to join their franchise.
Whilst a franchise does come with a fully tried and tested business model, it does not mean, for sure, that you will be success and make a great living. Why? You still have to put in the work and a lot of it too – you need to learn the operations manual like your life depended on it and you still need to network, quote, leaflet drop, sell yourself and get yourself known in the local area… just buying a book and some training will not turn you into Bill Gates!
The figures for start up businesses tend to be quite depressing and I am sure you have heard them? Half of all small businesses will fail in the first year, a further half of that in the year after and so on. My opinion on this, is that most people just do not understand how hard it is to run a business, they see others doing it or may work for a small business and think “yeah, I can do this and I could do it better” but people, it is HARD WORK and you need to be committed, focused and determined. Every day. You can succeed but you have to invest in learning your craft and improving on your skills all the time but, hey, you’re here, reading this, so that gives me great joy that you are doing homework, so keep going! 😉
Who do you think wins the match? Are you currently debating a franchise or start up? I would love to hear your comments or feedback below. Also peeps, don’t forget to sign up for the monthly newsletter, with all the best content from Maid In Busiess for the month.
CONNECT WITH ME ON THE INTERNET:
Want to know more about Kelly?
Linked In http://www.linkedin.com/in/kellymward
About Me http://www.about.me/kelly.ward
Personal Twitter http://www.twitter.com/madamward
Personal Pintrest http://www.pintrest.com/madamward
Personal Google + http://www.google.com/+kellywardmadam…