Do you dream of owning your own business?
Maybe youre just one of those folks with a passionate entrepreneurial spirit.
OK, OK, thatsmybusiness fantasy.
Did my specificity give me away?
Franchising or Starting From Scratch?
No Interest Til Almost 2027?
Balance Transfer = Credit Card Cheat Code
Both options have their pros and cons.
But heres some insider info on how to figure out which route will best help your business flourish.
Its easy and tempting to browse potential future business ownership options the same way we browse clothing catalogs.
Itd take a lot of dollar menu orders to get you back in the black.
Upsides
Buying a franchise amounts to buying an existing vision instead of developing your own.
Arguably, the main benefit of purchasing a franchise is built-in brand recognition.
No matter how good your burgers are, everyone already knows about Five Guys.
Buying a franchise gives you pre-baked marketing, and a better chance at success.
Plus, youll haveoperational resources and mentorshipfrom headquarters.
This can help you get through tough times or when you run into a situation that stumps you.
Terms can vary, though, so check your franchising agreement.
Franchising ismost likely an easier route, especially for first-time business owners.
And as mentioned above, you dont always need a ton of money to get started.
Downsides
Of course, all those benefits come with costs.
All the big sum does is get your foot in the door.
In short, youll owe a portion of your gross profits to the big guys upstairs.
Youll also have little input about changing the way your business runs.
For many, those are the real dream parts of opening your own business.
Franchises are so limiting, and the fees absolutely kill you, says ex-UPS Store owner Chris Dyson.
He should know hes owned two franchises and three non-franchise businesses.
(There are some exceptions; it onlycosts $10,000 to open a Chick-fil-A.)
Going It Alone
Franchising starting to sound a little more scary than sexy?
You might consider creating your own path and your own startup.
Heck, we here at The Penny Hoarder fit the successful tech startup description!
They might own restaurants, coffee shops or boutiques you frequent.
They might befreelancerswho market their skills be it cleaning houses, personal training, massage therapy or writing.
But you should be aware the private road can be perilous particularly if youre a business newbie.
Because of lack of experience, they may make mistakes that could end up costing [them].
It could cost even more than the fees franchises require, he warns.
But many have found fulfillment and success in the world of the privately owned small business.
The franchise wouldve cost her a required $10,000 franchise fee and monthly $1,000 fee.
Which Will You Choose When You Start a Business?
The choice is ultimately rooted in a variety of individual factors.
Jamie Cattanach is a junior writer at The Penny Hoarder.
She also writes other stuff, like wine reviews and poems follow along at www.jamiecattanach.com.
