Starting a business can be challenging, especially if you have limited knowledge and resources. Thankfully, you do not have to launch a brand new business to run one. The world of franchising has opened multiple opportunities for business-minded individuals who wish to forgo the process of starting an enterprise from scratch.
What is franchising?
Franchising is a system that enables you to acquire the rights, name, logo, and business model of a brand as a legal third party owner. Thus, you can manage an outlet of a company that already has a solid brand reputation and established history.
If you wish to run a branch, you can be a unit franchisee of a sub-franchise. Sub-franchising is a system that pertains to “the relationship between a master franchisee and the unit franchisee”. The system works like this — a franchisor who decides to expand their business will appoint a master franchisee in the country they want to infiltrate. The master franchisee then will act on behalf of the franchisor and acquire the developing rights of the business.
There are plenty of options for business industries that you can enter. For instance, the food industry is arguably the most well-known area for franchising. In fact, according to Entrepreneur.com, more than half of the franchises that ranked in their Franchise 500 list are in the food industry.
The Food Industry
The food industry is vast. It is also lucrative, considering that food is a necessity and a part of every person’s daily life. Whatever their dietary needs and preferences, all people eat for sustenance. Thus, the food industry will never lose consumers.
Just as there are hundreds of cuisines from all over the world, there are numerous types of businesses in the food industry — from pastry shops to fast-food restaurants. However, stores that offer on-the-go snacks and meals are more popular these days, especially since today’s working professionals are leading busy lives. A good example of a quick-service business is a sandwich sub franchise.
In the Entrepreneur’s Franchise 500 ranking, sandwich franchises have made it to the top 200. The total investment of these franchises ranges from $92,000 to $2,000,000. It is then important to assess your financial capacity to select which brand is most suitable for you.
Other factors to consider, aside from total investment, are royalty fees and the franchise cost. It is also advisable to conduct extensive research on the brand’s growth rate and the number of operating outlets. Determine the level of support given to unit franchisees by evaluating the brand’s training programs, marketing aid, operational support, financing availability, and litigation assistance. Lastly, it is best to take into account the brand’s strength. You can assess this by looking at their social media presence, operation size, and history in the franchising business.
Tedious planning and immense research are the key steps for ensuring that the sub-franchise you will be selecting will gain success. Educate yourself fully in the industry you are eyeing and consult an expert before finalizing a decision.