Business, especially for the inexperienced is fraught with risks. Neophyte entrepreneurs are advised to carefully screen their business ideas, assess the economic environment, make intricate plans and study technical, marketing and financial viability before taking the plunge.Mistakes can be costly and traumatic. Small enterprises, in particular, are especially vulnerable, because of their high mortality rates.
Banok’s food chain, based in Davao, has begun franchising for growth
Is it possible for a business to be risk-free?
To a certain extent, yes! That is if you happen to go for a franchised business.
Franchising can be quite a viable business choice. It is one that allows fledgling entrepreneursto access minimum-risk but highly successful businesses. With business franchising, you can be your own boss for as low as 10,000 pesos for small-scale franchises. Depending on your budget, you have diverse product options to choose from; from food stalls to restaurants, review and education centers, to personal care products.
On the other hand, franchising allows seasoned businesses to expand on tried and tested grounds.
Franchising offers the aspiring entrepreneurs with job satisfaction, independence, and an outlet for expressing creativity, minus many of the problems that led to business failure. In other words, if you are looking for a business with the least fears and tears, then franchising might be the way to go.
Today, franchising has become a favorite investment area among Pinoy entrepreneurs. It is estimated that in 1995, there were 50 foreign franchises in the Philippines and 60 local businesses in various stages of franchising their operations. Today, this number has ballooned to a total of 900 franchising businesses, according to the Association of Filipino Franchisers, Inc. In fact, the country has lately been known as the “Franchise Hub of Asia.”
Factors to consider
Brian King , in Marketing and Small Business, urges aspiring franchisees to evaluate all possible options before signing the dotted line on a franchising contract. Here are some factors to consider:
- Self-motivation – One must objectively assess his or her motivation to go into the franchising field. Consider the emotional stamina needed to cope with working longand unholy hours in order to establish the shop.
- Type of franchise – Study capital requirements and type of operations that appeal mostto you. Delve on time demands, being on constant call (for maintenance and repair franchises), long hours (fast foods), and normal working day (printing).
- The franchisor – Consider management ability, integrity and financial stability. How long has the franchisor been in the business? What are its policies and plans for development?
Before making a decision to take a franchise, you would do well to get in touch with existing franchisees to check on the level of support and evaluate terms and conditions.
Click this for a directory of franchising businesses in the Philippines.
For more information, on starting a a franchising business: check out these sites, among others: