Chai Sutta Bar®

10 reasons to start a Franchise Business vs Own Business

If you are an aspirational entrepreneur and looking forward to testing your luck on business, then you might be going through a lot of dilemmas. One of the most common dilemmas is whether to start your own business or join a franchise.

In your own business, you come up with a fresh idea, brand and procedure. On the other hand, you work for an already existing brand and its products or services under a franchise model. While both these models have their fair share of advantages and disadvantages, it is up to you to decide which one is your cup of tea.

What is Franchise Business?

A franchise business is a business model where the franchisor grants a franchisee the right to use its trademark, business model, and operating system. 

In exchange for this license, the franchisee usually pays an initial franchise fee and ongoing royalties based on their sales revenue.

Overall, business franchise in India offers a unique opportunity for entrepreneurs who want to start their own business but also want the support and benefits of an established brand and business model.

Franchise Business

Differences between Franchise and Own Business

The primary difference between a franchise business and an own business is the ownership structure and the support and guidelines provided by the franchisor. Here are some of the key differences between the two:

  1. Ownership Structure: In a franchise business, the franchisor provides a license to use its brand name, business model, and products/services to the franchisee, who owns and operates the business. In contrast, an own business is independently owned and operated by a single individual or a group of partners.
  2. Brand Recognition: A franchise business benefits from the established brand recognition of the franchisor. Customers are already familiar with the brand, making attracting and retaining customers easier. In contrast, an own business has to build its brand from scratch, which can be time-consuming and expensive.
  3. Proven Business Model: Franchise businesses have a proven business model that the franchisor has already tested and refined. This means franchisees can spend their time and money on something other than developing a working business model. In contrast, an own business has to build a business model and strategies, which can be risky and time-consuming.
  4. Training and Support: Franchise businesses provide training and support to franchisees, including assistance with site selection, lease negotiation, marketing, and operations. In contrast, an own business has to rely on its resources and expertise for these activities.
  5. Marketing and Advertising: Franchise businesses benefit from the franchisor’s national and regional marketing and advertising campaigns. This can save franchisees time and money on marketing and advertising activities. In contrast, an own business has to develop and execute its own marketing and advertising strategies.


Also Read, Global Presence of Chai Sutta Bar

Franchise Business in India
QSR Franchise Outlet

Ten Reasons to Start a Franchise Business Than Own Business

Here are ten reasons to consider starting a franchise business instead of your own.

1) Established Brand Recognition

One of the most significant benefits of starting a franchise business is buying into an established brand with a proven track record. This means that you’re not starting from scratch with an unknown name and reputation. Customers already know and trust the brand, making attracting and retaining customers easier.

2) Proven Business Model

In addition to an established brand, franchises also come with a proven business model. The franchisor has already figured out how to run the business, so you can focus on executing the model. This means you can spend less time and money testing different strategies to see what works.

3) Support and Training

When you start a franchise business, you’re not on your own. The franchisor provides support and training to help you get started and succeed. This can include everything from site selection and lease negotiation to marketing and operations training.

4) Marketing and Advertising

Marketing and advertising are critical components of any business but can also be expensive and time-consuming. The franchisor typically handles national and regional marketing efforts with a franchise business, saving you time and money. This can also help you get your business up and running faster.

5) Lower Failure Rate

Starting any business is risky, but franchise businesses have a lower failure rate than independent businesses. This is because the franchise model has already been tested and proven successful. Plus, the franchisor provides ongoing support and guidance to help franchisees succeed.

6) Easier Access to Funding

When you’re starting a business, funding can be a significant challenge. However, franchising can make it easier to access funding because lenders are often more willing to lend to a franchise business with a proven track record than an independent business.

7) Shared Buying Power

Franchise businesses often benefit from shared buying power, resulting in lower costs for everything from supplies to equipment to insurance. This can help franchisees save money and increase their profitability.

8) National or Regional Presence

Franchise businesses typically have a national or regional presence, which can help attract customers already familiar with the brand. This can be especially beneficial if starting a business in a new market or location.

9) Turnkey Solution

Starting a business from scratch can be overwhelming, but you’re getting a turnkey solution with a franchise business. The franchisor has already done the heavy lifting, so you can focus on executing the business model and growing your business.

10) Exit Strategy

Finally, franchising can make selling easier when it’s time to exit the business. With the brand and business model’s existing establishment, finding a buyer and getting a higher valuation may be easier than with an independent company.

Final Word

While a franchise model can be a great choice for freshers, starting your own business will promote fresh ideas in the business world. While the franchise model minimizes risks and provides guidance, starting your own business gives you full control of your business.

Hence, one should have a thorough understanding of both models before choosing the more suitable one. One needs to take into consideration the advantages and disadvantages of both sides. Once decided, one should be fully ready to face the challenges of the chosen model to succeed in their endeavour.