Technical Know – How to Guide You With The Start-Up of Your Own Business
Have you ever thought about starting your own business, but felt dejected due to the lack of knowledge? Well, that’s not a big problem indeed. If you have adequate funds in your pocket then you can surely buy a business that has a working marketing plan, with marketable product and management training in place. The first step towards owing a successful business is to understand the benefits and the risks associated with the particular franchise to avail.
In a franchise setup, rules are set out by a franchisor. The owner of the business runs that business and sells the products or offer services under some specified rules. The franchisor is the owner of the trademark, name or service mark of the products or services and sells the actual items or the rights to market the service to the franchisee. The entire process is operated under the laws of the Federal Trade Commission.
One of the simplest ways of starting a business is to grab the franchise opportunities in hand. The biggest advantage of doing so is that the name recognition is already in place in most franchise relationships and if you choose a popular franchise, you will have customers the day you open. Besides this you can take benefits from marketing plans, financial assistance, administrative training and managing guidance from the franchisor.
Starting a franchise is expensive, so make sure that you have collected the sufficient amount or have arranged for a financer. The cost of franchise depends on the franchise option you choose. Many franchisors charge a “Grand Opening” fee for the help provided by them. Once you start bringing in money, you have to pay royalty payments to the franchisor continuously. Royalty is a percentage of the gross income earned from your business. Also you might have to invest into an advertising fund every month.
Franchise relationships are of three types:
• The business format franchise provides the business owner with training, products or services to sell, marketing plans and help in getting the necessary financing.
• The product or trade name franchise, right to a name or trademark is sold to the business owner by the franchisor.
• In distributorship, the right to sell a product is given to the business owner by a parent company.
While purchasing a franchise, be prepared for giving some controls that can be placed over your new business by the franchisor. For example, you may be asked to conform to specific appearance standards in condition of your building or uniform of your employees. Another common control is a restriction on the items or services that you can provide.
On the whole to start up with a new business is not that difficult and proper knowledge and potential will definitely lead your way to success.