The initial phases of franchising are often filled with misconceptions. Many people exploring franchise business opportunities believe franchising is just about food, while others misunderstand cost, control, and the risk of it all. For first-time franchisors, it can be hard to differentiate fact from myth.
We want to help you tackle some of the toughest questions facing the franchise industry today. These questions come directly from you. Drawing a network of experienced franchisor executives and franchisees who are living the entrepreneurial life every single day, we aim to provide clear answers to the question of how does a franchise work. This question should be addressed early in your franchising journey.
What are the most common myths about franchising?
Franchises Don’t Run Themselves
Tackling one of the most common franchise myths, Jeff, the founder of Max Strength Fitness, dismisses the idea that once the agreement is signed, the franchise business will now just simply run itself with little to no effort needed. “Not true at all,” he says. He shares that the franchisor is there to offer guidance and support, but they’re not going to do the work for you. The franchisee still has to put in the effort (lots of effort) to build their business.
This founder knows a thing or two about putting in the work. He’s a chronic overachiever who earned multiple degrees and invested years of his time in physical therapy prior to launching Max Strength Fitness. In the final part of Jeff’s answer, he hits the nail on the head by sharing the old adage, “you can lead a horse to water, but you can’t make him drink.”
Another brand partner who echoes this sentiment is Joshua, founder and CEO of Joshua Tree Expert, who shares, “A franchise system is like a living organism that requires constant attention, updates, innovation, and communication to stay competitive and healthy.”
Franchises Aren’t Plug-and-Play
Another misconception about franchise business opportunities is that they are plug-and-play investments. Scott Maher, the founding principal of Franchise Altitude, who leads several franchise brands, offers some advice: “Franchises aren’t a business in a box. The most significant variable in franchising is the human element, and you can’t put people in a box. Ownership matters.” Franchise businesses are not plug-and-play. Franchisees have to be prepared for the grind. Without it, they’ll undoubtedly fail as business owners.
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Do You Have What It Takes To Be a Franchisee?
If you want to become a successful franchisee someday, there’s simply no substitute for hard work. Connect with us so we can answer more of your questions and help you understand the franchise industry.
FAQs
How does a franchise work after the agreement is signed?
Once the franchise agreement is signed, the franchisor provides the initial training and guidelines or standards for the franchise. They also offer ongoing support and check in on the franchisee. The franchisee is responsible for day-to-day operations and uses the franchisor’s system. A successful franchise is dependent on the franchisee’s execution and the franchisor’s support.
What role does the franchisor play versus the franchisee in daily operations?
The franchisor guides the franchisee. The franchisor creates the system and guardrails for the franchise while the franchisee follows that framework in managing the staff, finances and local operations.
Why do some franchise business opportunities fail despite strong brand systems?
Failed franchises are often the victim of believing common franchise myths. These franchisees underestimate how much work is required, believing that this investment will be “easy money.” Additionally, an owner who isn’t involved or accountable often leaves the franchise unstable.
Are franchise business opportunities less risky than starting an independent business?
Opting into a franchise can reduce some risk as a proven system and recognized brand support a new business owner. However, franchising doesn’t eliminate risk and a successful business still requires effort. Franchises provide structure and stability, but not a guarantee of success.
How can prospective franchisees evaluate whether a franchise business opportunity is right for them?
When determining if franchising is right for you, first look inward at your skills and work ethic. Be ready to follow a system, not your own way. Connect with current franchisees and learn how the expectations align with your abilities. Determine if your commitment level and long-term goals align with potential franchise business opportunities.