Look Out, Overhead: The Advantages of Buying an Online Franchise
When most people think of a franchise business, they automatically think of giant global franchises such as Subway or McDonald’s. These are “brick and mortar” franchises, meaning that the franchisee buys an actual shop or restaurant. But there are also online and home-based franchises such as Blue Coast Savings Consultants (a cost-savings consulting franchise run entirely online) and Cruise Planners / American Express Travel (a home-based cruise / vacation planning business). Internet-based franchises have distinct challenges, but also a range of advantages, which explains why many start-ups and entrepreneurs are becoming online franchisees and buying into the business.
Cost Advantages of an Online Franchise
One of the biggest advantages of an online franchise business is low overhead costs. The expenses of a traditional franchise business include buying commercial space, such as a retail shop or restaurant, and décor, paying building maintenance costs, and managing staff payroll. An online franchise is much cheaper to buy and run – all you really buy is a domain name and website. This means you can spend the rest of your budget on other key areas like marketing, advertising, and web development.
Online Franchises - Open for Business 24/7
Another advantage of an online franchise is that the ‘online shop’ is effectively open all day; revenue can be generated 24 hours a day, seven days a week.Also, an internet-based business is accessible by anyone, anywhere, reaching customers around the globe. Unlike conventional franchises, online businesses aren’t restricted by physical location or traditional hours of operation.
Online Franchises Move Quickly
From the franchisor (home headquarters) perspective, a hugely significant benefit of running an online franchise system is the ability to easily implement changes across the franchise.Instead of re-branding or changing protocol across dozens or even hundreds of physical locations, online franchises can make overhauling changes or tiny tweaks throughout the whole business with minimum effort. For the individual franchisee, this means that the benefits from a great new product idea, clever marketing campaign, or other helpful innovation can spread across the entire franchise system in almost no time.
Running an online franchise offers a business-owner a highly-supported network of franchisees with significantly reduced costs. The low initial investment and other advantages attract new franchisees daily, making online franchises a trend that will continue to grow in popularity.
Choosing a Service Franchise or a Product Franchise
Most of the franchises offering Product oriented goods have very stringent rules. Since their brand is associated with a tangible good they must guarantee the desired quality from the consumer’s expectation. Franchisees must purchase the goods from a designated supplier and must keep items in their inventory as suggested by the franchisor. This can be company regulated policies or simply to help the franchisor launch some of their new products.
5 Reasons Why Franchisees Fail
There are a number of reasons why a franchise can fail. Some of the reasons are based upon a lack of capital and/or particular skills necessary for a particular franchise to be successful. On the other hand, there may be factors that are out of the franchisee's control: a franchise program that has a lack of customer demand or a poor product, for example, can lead to failure despite the franchisee’s best efforts (another example of why the franchisee should have done their research before investing).
The American Dream is NOT Out of Reach!
In the definition of the American Dream by James Truslow Adams in 1931, "life should be better and richer and fuller for everyone, with opportunity for each according to ability or achievement" regardless of social class or circumstances of birth.