Word of Wednesday – Business Opportunity

By kerry.crocco |December 9, 2016

Franchise.com A business opportunity (or bizopp) involves the sale or lease of any product, service, equipment, etc. that will enable the purchaser-licensee to begin a business. …


Is a business opportunity different than a Franchise?

Yes! Franchises continue the relationship with the buyer or franchisee beyond the purchase. This means that franchisees pay royalties and in turn receive support from the corporate entity (also known as the Franchisor), including systems, branding, training, and in some cases, marketing and advertising.

Business opportunities sell the rights for a buyer to start their own business with the opportunities concept. However, there is no continuing relationship after the purchase and the business opportunity does not have the right to exercise control over the owner after the sale.

Different states have passed laws regulating and defining business opportunities. In general the states with laws around business opportunities use the following criteria to define them:

That the purchaser will be provided locations, or assistance in finding locations, for use in the sale or distribution of the goods or services; That the purchaser can earn a profit in excess of the initial payment; The initial fee paid by the purchaser to start the business opportunity is greater than $500; That there is a market for the goods or services; That there is a buy-back arrangement; The purchaser many times, has rights to use the trade name or trademark.

Which is better – a franchise or business opportunity?

It depends what you are looking for. If you want the freedom to run your business the way you want, you don’t need structure and systems, but just need a good idea to run with, then a business opportunity may be right for you. Business opportunities investments are typically lower than franchises. But you get what you pay for…so if you need more structure and a path that has been tried and true to follow a franchise may be a better fit for you.

Learn more about the similarities and differences of franchises and business opportunities.

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