subject: The Difficulites That New Franchise Ideas Face And How To Avoid Your Franchise Failing [print this page] The Difficulites That New Franchise Ideas Face And How To Avoid Your Franchise Failing
If the idea of setting up your own business appeals to you, being your own boss, setting your own hours and so on, then the option of buying a franchise is one of the best options you can take. The appeal of franchise ideas are clear for all to see, they offer an instant brand name, a proven operating system with years of experience and support structure to help your new business. But not everything is as easy as you think when setting up and running a home based franchise. Especially now, there is always the possibility of a franchise failing and you should always look at the negatives when starting up any business. The rate of failure for franchises depends on the sector and the brand you choose but here are a few points that contribute to franchise failure.
An ineffective franchise partner
The basis for creating successful franchise ideas is to offer the public something that they want and need, such as a product or service. The public must have a trust in the brand they are dealing with and that will therefore keep the customer coming back time and time again. A franchise failure happens because the public are not interested in your product or service or have a negative attitude towards the brand. If the franchise partner is not providing this level of service then this will affect your business.
Competition
A home based franchise may come with an exclusivity agreement, which generally means that no one else in your area is able to find a franchise for sale from the same franchise partner. You have to ask your self the question, how many fast food places does one area need? Is there enough catering opportunities in the area? How many people in my area need a cleaner? The agreement for your exclusivity to the area will not stop competition, if the area is small, an established company may start offering your service and take your customers away from you.
Location
Can your franchise ideas be found? Whether it be on the high street or on the internet, if no one knows it is there than you will fail to draw customers. The best products and services in the world can not be sold if the customer does not know where to find them. Generally the more center to town that your shop or business is located then the more cost it will be to you. Most franchise partners spend a lot of time and money ensuring that their location maximizes their opportunities, but some franchise ideas are forced to taking lesser locations because of the cost involved. In regards to an online business, 90% of users find businesses through search engines so if you do not rank high on Google for your chosen product or service then some optimization of your website has to occur. This can be a costly medium on top of the initial website, but it will be worth the extra cost.
Marketing
A home based franchise may be advertised in your local or national papers, websites and magazines but once your franchise is set up where will that be advertised? A franchise opportunity may include campaigns in your local area but most of the advertising and marketing is left up to the franchise partner. Although the brand may be well known that does not mean that you will automatically get customers or have an income like other established franchises. If your franchise is not promoted in the correct way and to your target audience then your franchise ideas may fail as people will ignore your product or service.
