A Franchise is a business model that has allowed many people to stop being employees as it facilitates the transition from employee to self-employment. However, franchises are not for everyone or all types of businesses. As a franchise development consultant and franchising lawyer helping organizations develop franchises or individuals purchasing one, I would like to share some issues that can help you decide whether purchasing an existing franchise in Puerto Rico is right for you. This generally applies if you buy a franchise elsewhere in the U.S.
In a way, franchising resembles a large company where each employee is their own boss. Franchising also combines many of the benefits of starting a new business and buying an existing one. Even so, it presents a different working relationship since the one who buys a franchise has to follow certain specific rules that are difficult to modify.
They say that those who buy a franchise work on their own but they are not alone. When you buy a franchise you are buying a business that generally already has an economic model, a brand and a team of people who give you structure, support and training. This frees you from a lot of initial work and because they are already proven concepts, you have a certain degree of security included in the initial price of the business. These benefits explain why the failure rate of new franchises is much lower than that of new businesses.
The benefits of a franchise have their price. You have to compare what you receive with the franchise with the cost of the investment of creating your own business or buying one or running. In addition, the franchises require each member to pay a monthly royalty and an item for marketing.
Despite purchasing a franchise in Puerto Rico, in many ways you will be building the business by yourself because, clients will not be banging at your door and generally the franchisor will not be handing them out to you. This requires you to develop a marketing and sales to develop cash flow.
A myth that attracts people to franchises is the mistaken belief that customers will come with the franchise. This can only be said for franchises with established brands. The rest are the local franchise owners themselves who open the market to the parent company by making themselves known in their region. For many people, this arrangement does not make sense. They think that if they are going to create a market, they better do it for their business and not for another; and in many respects they are right.
When evaluating the investment of a franchise in Puerto Rico, consider the time and cost of creating the features that the franchise already includes. When you go to invest consider what are you getting for your money. See how much you are spending from your capital, how much you are going to get and in how much time. Hire an accountant to help you make an income projection.
The nature of the franchise limits your freedom to operate as you wish. Imagine if all the other franchise owners operated as they wanted, there was no uniform brand and service/product and that is one of the characteristics that distinguishes the franchise. The franchisor is very strict with its rules and procedures because the entire organization can be affected due to the failure of a single operator. It does not matter whether you are buying a franchise in Puerto Rico or in Hong Kong. The franchise system requires certain standards and processes that are uniform anywhere on the planet. If you are very independent, enjoy changing things frequently or doing things your way, franchising may not be the right model for you. If you want to know more about acquiring a franchise, contact your franchising lawyer or franchise lawyer in Puerto Rico
Copyright(c). You cannot copy content of this page.