Searching for a business for sale requires reflection on your goals and the reasons you want to buy a business. Investing in a large national brand with lots of recognition can be incredibly tempting. But there are also advantages to becoming part of a company with a smaller footprint. Buying a small business has many advantages, which align with the reasons many people want to own a business to begin with.
3 Advantages of Small Business Franchise Ownership
The advantages to buying an existing business that you don’t have with a startup include a better lifestyle as the owner, more financial security and certainty, and benefits to the local economy and community.
Lifestyle Benefits of Owning a Small Business Franchise
Owning a small business franchise means you become your own boss. At the same time, you are not entering the market without any support. By buying into a small franchise, you get a tried-and-tested business plan, advice about marketing, support selecting a location and hiring staff, inventory management resources, and more. The flexibility and self-direction of being a business owner is still part of the equation, while the uncertainty and anxiety of owning a startup is reduced.
Financial Benefits of Owning a Small Business Franchise
Franchises with a small footprint still carry many financial benefits of ownership. For instance, as a franchise owner, you may receive access to discounts on inventory and supplies thanks to bulk purchasing power between you and the other owners. On a larger scale, a lot of necessary software and business infrastructure is likely to be set up and included as part of the investment in the franchise. Some parent companies take care of the marketing for you or even send you leads directly.
Advantages of Small Business to the Economy
Investing in a regional or local franchise with a smaller footprint allows the company to grow, deliver great products and/or services, and create jobs for people in the area. This helps grow not only the local economy but also the community and regional identity. The small franchise you invest in could become the best-kept secret of the area, and a destination people look forward to visiting when they return because it can only be found near you.
Factors to Consider When Buying an Existing Business Franchise
There are four key factors to consider when buying into a small business franchise: the parent company you will be working with, the current and future market for the business, the legalities of the agreement, and ultimately, whether it feels like the right choice for you or not. You can answer the questions on the checklist below to get a feeling of whether you can make a confident decision or need to learn more.
Buying an Existing Business Checklist
The Parent Company (Franchisor)
- Does the franchisor have a good reputation?
- Have your interactions with them met or exceeded your expectations?
- Do other franchisees have positive things to say about their ownership?
Current Market Conditions and Forecast
- Are the products or services you will be selling recession-proof?
- Have similar concepts been tried in your area and failed?
- Have all the owners of business locations experienced success?
Franchise Agreement, Fee Structure, and Contract
- Do you clearly understand what fees you have to pay, why, and for how long?
- Do you understand the terms and conditions, including what counts as a breach of contract?
- Do you know what happens if and when the contract is breached?
Personal Goals and Desires
- Do you want to own this business?
- Will you receive training and experience that makes you feel fulfilled in your work?
- How long do you want to own the business?
These are just some of the questions that can help you decide if buying a small business like a franchise is right for you. Even if you are considering buying into a larger national franchise, completing this checklist can still help you feel confident in this choice and investment.
Franchise.Com: Your Resource for Turnkey Small Business Opportunities
If you are convinced that buying a small business franchise is right for you, the next step is to decide on the concept that will make your dream a reality. Franchise.com is a well-established and trusted resource for buyers to explore thousands of listings across market sectors, investment amount, geography, and many other search parameters. The most advantageous small business for you might be one that’s in a certain niche or price range, or it could be one allows you to work from home. We are here to help you find the perfect fit for yourself, your goals, and your community. Explore our massive franchise directory and get in touch with parent companies easily through our website. The decision to buy a business of any size is a significant milestone and a very exciting time. Congratulations!