From customer to franchisee: Is it a good idea? | Be The Boss

From customer to franchisee: Is it a good idea?

If you are a customer of a particular franchise that delivers a service or product that you are willing to travel for because it is not available in your immediate vicinity, you may see a gap in the market for you to open up your own branch of that franchise in your hometown. Should you become a franchisee when you were previously a loyal customer?

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Why people make the leap from customer to franchisee

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Convenience

If you are a loyal supporter of a particular franchise but it is not available in your local area, it makes sense to open a branch yourself. You will get access to the products you previously purchased from somebody else, reduce your traveling time and expenses, and be able to share your enthusiasm for the brand with other locals.

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Business opportunity

If the franchise brand that you are willing to travel for is always busy, there is a decent likelihood that you would also be busy if you opened a branch in your local area. You would need to make the leap from employee to business owner, but if the business that you frequent is thriving, there is a good possibility yours would, too.

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Passion

If you are truly passionate about a brand, you will be able to sell its products and services well because you will have first-hand, personal experience using them over a prolonged period of time. Your passion will pique the interest of potential customers and convert interest into sales.

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Risks to consider

  • If you are traveling for a service rather than a product, remember that opening your own branch of the business means that you will have to deliver that service rather than having someone else do it for you. If you enjoy receiving the service (such as beauty services), you will still have to travel to receive it or hire someone competent to work alongside you, paying their wages and finding them work in order to benefit from running the business yourself.
  • The franchisor will allocate you a territory, and you will be unable to enter another franchisee's territory or poach their customers. Sometimes, if a proposed territory is too close to that of an existing franchisee, you will not be accepted by the brand unless you suggest a location further away, which will reduce the convenience factor and increase your costs.
  • Once you make the jump from employee to business owner, you will no longer be bound by a 9-5 schedule and will not receive a guaranteed monthly salary. You will have to invest both time and money into making a success of your business, and there is still no guarantee that your business will be profitable.

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There are certainly advantages to making the leap from customer to franchisee, but make sure you do so with your eyes wide open.