Franchises are anything but “one-size-fits-all.” Many smaller-sized enterprises, known as “micro-franchises,” represent an opportunity for budding entrepreneurs to get in on the ground floor of a potentially successful business.
While still adhering to traditional franchising models, taking a “micro-approach” provides opportunities for smaller and medium-sized enterprises. Many can be operated at home or from a car, significantly reducing the overhead that comes with “brick-and-mortar” operations.
“Small” is relative based on the dedication, diligence, and overall work ethic of a franchise owner. Thinking “big” is a strategy that could lead to significant success close to, if not on the level of, more prominent franchise ownership.
As with any type of franchise – large or small – franchisors have already done a significant amount of work that their franchisees can benefit from. Longtime brands that are well known provide instant name recognition for the franchisee.
While a franchisor’s track record may seem impressive, franchisees should still do their own “homework.” Looking at the competition can provide insight into saturated markets and competitive market shares and whether similar businesses are thriving or struggling.
Before signing on, reviewing the terms of the agreement with attention to detail is of paramount importance. A small franchise may not be small when it comes to the fees and upfront costs involved in the purchase, not to mention the percentage of incoming revenue required over time.
Formalizing the agreement is only the first step towards a path that involves hard work in building a customer base. As profits come in, the need to reinvest that revenue is necessary when it comes to what is known as increased scalability of products and services. The more customers, the more word of mouth gets out to other potential clients.
A small and successful franchise can do just as well as more traditional models, if not better. Thorough research and a solid work ethic can bring ongoing, if not unlimited, success.