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Ready to Work By Yourself For Someone Else? Things You Need to Know About Franchising

Running your own business has the long-standing reputation of being the American dream. You get to set your own hours, invest in your own business, and benefit directly from your hard work. But have you considered the flip side? Building a business involves countless hours of work and investment, digging into your own pocket for funds, and the constant fear that you have not built a company worthwhile enough to make it in today’s market.

For many people, the middle ground between owning their own business and decreasing their risk, can be found in franchising. Basically any business that you can find all over the country is a franchise. Big name companies like Subway or McDonald’s are franchises; meaning, the corporation has built up the company, with marketing and recognition, but you are able to own your own personal store.

The startup expense of a franchise typically costs a few hundred thousand dollars, but for many it holds far more certainty than developing a brand and company name from scratch. Keep in mind, royalty fees must be continuously paid to the overseeing company, but you can keep everything left over from that. Included here are a few things to know about franchising before you decide to buy-in.


Franchises are great for those who are ready to strike out but are uncertain of developing a company model, product, or brand; you enter into your new business with an established brand-name and popular product. You can set your own hours, hire your own staff, and turn a very lucrative profit in many geographic areas. For many franchisees, the peace of mind that comes from buying into an established brand outweighs the cost of paying royalty fees each year.


Aside from the benefits, there are many other considerations to take under thought before committing to your franchise. For example, the high cost of starting up your franchise can be a large inhibitor. While Subway franchises are notoriously cheap to start up, they do not have the profit margins available with other restaurants.

Additionally, franchise owners will never experience the same kind of returns on work and product sales as independent business owners. An independent business will be able to retain all of their earned revenue for themselves and their business, while a franchisee will always be paying a percentage of their earnings to the company. This constant bite in earnings can be hard for some franchise owners to stomach.

While the risk is less for many franchisees than small business owners, it is still present. Downturns in the economy can cause unforeseen drops in business, and changes in your local economy can be even more detrimental. Careful research into the economic climate and your geographic location can help you determine the best time and area for opening a franchise.

About Stephanie

Stephanie Rosen is a financial market analyst and a blogger. She writes about stock market and investment opportunities around the world. You can find her latest ideas on here. Just signup our news letter today and receive regular updates of Stephanie.