Is Buying a Franchise Worth It? A Comprehensive Guide
Why Owning a Franchise is Worth It for All Types of Entrepreneurs
Franchises are a long-standing staple of the American economy,and are set to only grow in popularity. According to the International Franchise Association, the overall number of franchise establishments will increase by more than 15,000 units in 2024, or 1.9%, up to 821,000 units in the U.S.
As franchises only expand in popularity, many entrepreneurs are considering the possibility of purchasing one themselves. That begs the question: is buying a franchise worth it?
Let’s dig into what buying a franchise actually entails, and the key benefits that make buying one so valuable.
- What Does it Mean to Buy a Franchise?
- Benefits That Make Buying a Franchise Worth It
- Working With CoolVu Ensures Buying a Franchise is Worth It
What Does it Mean to Buy a Franchise?
When a business operator (franchisee) buys a franchise, they enter into a franchise agreement with a brand (franchisor) that allows the franchisee to own and operate a branch of the franchisor’s business for a specific number of years. In turn, the franchisee has access to the brand’s resources within the parameters of the contract — including brand identity, logo, marketing materials, training materials, reputation, and proprietary business model.
To buy and operate a franchise, franchisees typically have to pay franchisors a few fees. One is the initial franchise fee — a one-time fee paid to the franchisor to become part of their franchise system. As a franchisee continues to operate, most franchisors also require royalty fees — payments based on a percentage of gross income throughout the length of a franchise agreement.
This, of course, only includes the fees paid directly to the franchisor. Additional operational costs when buying a franchise may include further advertising, renting a space, buying equipment, professional fees, and more.
How do Franchise Agreements Work?
Franchise agreements typically last between five and 20 years, allowing franchisees to run a business for that period of time. Around the end of a franchise agreement, it’s up to the franchisee to either renew the contract or prepare to cease all franchise operations. In the cases where franchisees opt to not renew a contract, they must either close shop or sell their franchise location to a new franchisee.
Benefits That Make Buying a Franchise Worth It
Buying a franchise comes with immense benefits for entrepreneurs at all levels of experience. From easier financing to a quicker launch, here are just a few of the key benefits that make buying a franchise a great investment.
Ongoing Support From Parent Company
Unlike entrepreneurs starting their own business, franchisees can rely on the support from a parent company as they jumpstart their operations. Support may come in the form of branding, training, marketing materials, and more.
Many parent companies offer both online and in-person franchise training to prepare franchisees for running their business. CoolVu, for example, offers a four day, in-person initial franchise training with the executive team and regional support directors. This training includes education on product knowledge, marketing strategies, product installation, territory profitability, and more. Meanwhile, franchisees can access online training videos after in-person training concludes.
Beyond training, franchisors may offer in-field assistance, sales and performance coaching, installation support for projects, and more. With years of diverse experience within a field of business, franchisors know about potential pitfalls and can help new franchisees adapt and prepare.
Quicker Business Launch
With an established brand identity and greater trust from investors, launching a franchise takes far less time than launching a business from scratch. While the speed in which a franchise launches varies from brand to brand, the process is streamlined compared to opening a similar business.
Prior to opening a franchise, franchisees will need to secure proper funding and likely go through training from the brand. However, the steps of this process are outlined and pre-existing, as opposed to the uncharted path to opening a brand-new business.
Take licensing a franchise from CoolVu. From your initial inquiry into becoming a CoolVu franchise partner to the end of in-person franchisee training, it takes about 30-45 days to open doors as a CoolVu Franchise Partner.
Easier Financing Than Starting From Scratch
A key aspect of launching faster than a brand-new business is the easier financing provided by licensing a franchise. With more options and easier to gain support, franchise financing is a massive benefit compared to businesses starting from scratch.
When approaching banks for loans, franchisees can present detailed, successful business plans based on the success of past franchises. Many franchisors even provide options for in-house financing — minimizing bank involvement and offering another avenue for building a business.
Many brands, including CoolVu, also offer financing initiatives for veterans, women, and minorities looking to take advantage of our franchise opportunity. With CoolVu, Veterans pay $0 in Initial Franchise Fees, while women, minorities, and first responders can leverage a 50% reduction of the Initial Franchise Fee.
Lifestyle Independence
Many franchisees look to buy a franchise for greater freedom to dictate their schedule. By being their own boss, franchisees can plan business on their time. Additionally, some franchises even offer opportunities to work without an in-person office — saving valuable funds to be used elsewhere.
CoolVu franchisees have the opportunity to comfortably and flexibly work from home. Franchise partners sell and install within their local territory via home offices. In turn, no brick-and-mortar location is needed. Plus, with CoolVu, franchisees can work their own hours and delegate additional labor how they see fit. Forbes projects 32.6 million Americans will work remote by 2025; franchisees can take advantage of this trend.
Working With CoolVu Ensures Buying a Franchise is Worth It
With extensive benefits and an easy launch, buying a franchise can be a lucrative investment for entrepreneurs of all levels. As with any business, however, franchise ownership is reliant on successful partnerships. For franchisees, finding the right franchisor is essential.
Consider CoolVu. As a CoolVu Franchise Partner, franchisees can benefit from our 25-year legacy of industry success providing top-of-class window installations — including films, graphics and surface solutions products. Our Franchise Partners leverage a comprehensive training program, alongside lead generation assistance and product development, to grow incredibly successful franchises.
Interested in joining our network? Contact us today and learn how we can help build your business.
