Franchise Fees And Royalties

franchise fees and royalties

Buying A Franchise Vs. Starting Your Own Business

Getting into the world of business has its own set of challenges and not without its risks.  Many people want to be there own boss, and that is one of the primary reasons why people want to get involved with entrepreneurship.  Depending on the nature of business you would like to get into, purchasing a franchise offers quite a number of benefits as compared to starting one from scratch.  Starting a business from a scratch is not without its risks – but by purchasing a franchise, many of these risks can be minimized, if not totally eliminated.

With a franchise, you are essentially purchasing a proven business system that has undergone many years of planning and development, something that has already earned credibility and an excellent reputation.  What you are getting here is one of the best benefits of purchasing a franchise – brand awareness.  It’s like skipping the riskiest and hardest stages of starting a business as everything has already been set-up for you; all that’s left to do is to run the business itself.

As a franchisee, you will be receiving a wide range of technical and managerial support from the franchisor, and they will provide you with all the training you will need in order to run the franchise properly.  You also get to share the benefits of the marketing strategies and advertising campaigns of the franchise, which means you don’t have to worry about how your products or services will reach your customers.  The name of the franchise already speaks for itself and lets people know the quality and credibility of your business.

The benefits of a franchise, of course, come at a price.  Franchise fees and royalties – these are what you pay the franchisor for all the hard work they have invested into the business, for all the years they have spent researching and developing their products and establishing their brand name.  Just like starting your own business from a scratch, these are all investments you will have to make, although getting a franchise may increase the amount you have to invest as you are purchasing an already established business system.

Being a franchisee, you must also understand that you will be bound by the policies and regulations that the franchisor has set-up based on the franchise agreement.  Unlike having your own business, you will have limited freedom in making decisions, and every move you make will have to be in accordance with the guidelines the parent company has established.  Since you are carrying the name and image of the parent company, you have to play by their rules.  For them, this is very important so as to maintain the credibility and reputation of their company.

Both starting a business and purchasing a franchise require  some initial investment, although a franchise may be more expensive due to the franchise fees and royalties, they usually pay off in the long term.  In any case, it is highly recommended that you weigh both the pros and cons of purchasing a franchise in order to determine if it is suitable for you.

For more information about Buying a Franchise, Franchises for sale, and Advertising a Franchise visit us today at and get a free listing on your business now.

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Franchise Fees and Royalties