X factor in franchising

Watching the 132 golfers at FASA’s Golf day proudly representing their brands whilst networking with other brands, some of them rivals, it struck me that there is something magical about franchising and that it is indeed a family of extraordinary business people. The X factor is what separates the extraordinary from the ordinary. Franchising is unique in the world – a business format that has revolutionized small business – allowing anyone, from any background, to be part of a bigger business and an established brand. We look at what makes up the “X” factor in franchising

Franchising fireworks

From that first entrepreneur that stumbled on an exciting concept, developed it and then sold the first franchise to an equally excited franchisee, there is always a sense of enthusiasm and passion in franchising.

Innovation

Think of big brands and you think of franchise brands that have conquered the world. No other business format has been credited with taking an idea, piloting it, duplicating it and then spreading it across the world.

Turning ordinary people into business successes

Franchising is credited with giving anyone and everyone the opportunity to be successful – whatever your station in life or your background, you can be trained to operate most franchise concepts.

Joining the club

Once you join the exclusive club that is franchising, you join the hundreds of thousands of people around the world who have been given the opportunity to become successful business operators thanks to the franchise business system. This sense of ‘belonging’ is what sets franchising apart.

Anything can be franchised

No other business format offers such a wide range of opportunities in such diverse sectors. In the United States almost 90% of business sectors are franchised with other countries fast catching up – a testament to the success of the system.

Skills transfer

Franchising’s contribution to skills transfer is immeasurable. From the prospective franchisee who buys into a franchise with no qualification in either the sector or in business and is fully trained to operate his business, to the staff who are given thorough and on the job training, franchising can be credited with developing a whole new business environment.

Job creation

In South Africa alone, franchising creates over 500 000 jobs; worldwide franchising employs millions. For this reason alone franchising should be the priority of every country in the world who wishes to grow its economy through its small business sector.

Investment security

Although not completely fool-proof, franchising’s success rate is way higher than that of independent businesses (failure rate for independents = 80%; for franchising = 20%). Success if you follow the system and work hard is well within reach for any franchisee.

Risk aversion

There is no question that franchising lessens the risk of failure in many respects. From choosing a franchise over going it alone to using the franchise system to build a successful business and often going on to buy into multiple outlets is evidence of franchising’s risk aversion rate.

Building wealth

Franchising has provided a good living to hundreds of franchisees and made a good number of them wealthy. A franchisee typically puts in the investment, time and effort into running a successful franchise brand knowing that he is building a viable business within a strong brand offering that will have a strong re-sale value.

The sky’s the limit

The sky’s the limit for franchisees with passion and ambition to build their own little business empires. Most franchise concepts welcome multiple store owners and there are many very, very wealthy franchisees who have taken up the challenge to own more than one franchise.