The dream of every new franchisee is to have a sizable business. For a variety of reasons, including financial constraints, a lack of skilled labor and management, and even access to suppliers, it might not be feasible.
As a result, before purchasing a franchise, you should consider all franchise options available to you.
The Big Names
Think of Starbucks and McDonald's. These franchises are well-known and well-funded. They have a strong market presence and a proven track record, thanks to their experienced and seasoned management team.
Upside
These are low-risk ventures that may be recession-proof. Due to their large audiences, these franchises also have greater geographic reach and coverage.
One of the primary reasons for selecting these franchises is that you already have a customer base. People are already familiar with the brand and can easily rely on it more than any other franchise in the same sector.
Downside
Their greatest asset is also their greatest weakness. Because of their large market value, they frequently compete with other large brands, resulting in intense competition. As a result, this competition causes sales to fluctuate at times.
They also have higher entry fees by default because the brand has established its own value and presents less risk to the franchisee. As a result, the initial investment in these larger franchisees is substantial.
Stars on the Rise
These franchises are gradually expanding their customer base. As a result, they are looking for franchisees to help them expand their brand, so it is no surprise that they welcome franchisees and offer incentives.
Upside
These franchises are less difficult to establish than larger franchises. In addition, because of the low investment requirement and flexibility, there are more options for a faster start-up.
Downside
While a smaller franchise is expanding, there may still be bugs in their system. This could lead to issues with implementation, among other things.
Both of these franchise sizes have advantages and disadvantages for different people. It all comes down to the prospective franchisee's position and what they have to offer the franchisors.
Depending on your local market conditions, a Rising Star franchise may outperform a Big Name franchise in a competitive market.
If you would like to discuss your ideal franchise size, please schedule a brief call with me.
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