July 22, 2017
Godwin Vargheese
 Owning a Franchise Business

Owning a Franchise Business

If you are an entrepreneur looking to invest in the right kind of businesses, you might have wondered at least once about which is better: owning a franchise or setting up a business of your own. You don’t have to worry anymore because we have got the all the answers right here.

Franchising refers to a business model in which the franchisee (person opting for the license to do business under the franchisor’s brand name and operating model) is granted a license by the franchisor (the business owner) to use the franchisor’s brand name, business model and other intellectual property rights such as brand name, technical expertise and assistance, patents and trademarks, marketing strategies etc. in return for a fixed sum of money. Based on the current Indian business scenario, especially in the education sector which forms 32% of the 1200 franchises in India and is expanding owing to increasing awareness and household income, franchising is the route that has seen a major boom. (ICES, LinkedIn)

In the next section, we are going to highlight the advantages franchising has on offer as compared to setting up your own business.

Established brand name and reputation

Unlike starting a new business from scratch and setting aside marketing and promotional budgets, a franchisee enjoys the benefit of an established brand name so there’s no need to go the extra mile to attract customers. This is especially important in the education business where brand value matters a

Guaranteed and quick high returns on investment

A franchise model guarantees high profitability in return of low investments. This is because setting up a new business requires a huge amount of capital expenditure and added expenses which can often be unaccounted for unlike a franchise where the cost of setting up is fixed as stated by the franchisor and raising capital is easy because banks prefer lending to trusted brands. The profits again are quick because of brand value and high demand in the sector.


 HIgh ROI in Franchise Business

HIgh ROI in Franchise Business

No need of extensive business background or training

There’s no need for any prior background or training to start a franchise whereas starting your own business would need some experience in the area to reap profits. A franchise provides all intellectual property rights and comprehensive training required besides the license so that you have all the technical know-how to get start So if you’re going for a franchise in, let’s say, the education sector, there’s no need to prepare a curriculum or package, it will all be provided by the franchisor thus saving both time and money.

No risk of failure

In a business that’s being set up from scratch, the model largely relies on trial and error and is therefore subject to market risk and failures. A franchise is tried and tested so all you have to do is stay motivated and work hard while following the guidelines as specified and you can stay assured that your business is going to stay afloat.

Continued professional support and product updates

Any business needs to keep updating and reinventing itself to stay at the top of the competition which again requires further investment of time and money. This is not the case in a franchise. The franchisor keeps you updated with any changes that are happening and provides the technical and professional support if required at any point.

 Franchise Vs Own Business

Franchise Vs Own Business

Thus, franchising is the most profitable way to do business right now, especially in a flourishing sector like education where high returns are guaranteed while also ensuring that it is risk-free because of the growing need for quality education in India. It has been predicted by experts that the Indian franchise business would continue to boom and is, therefore, the way to go. (Mint, 2016)


1 Comment. Leave new

TechKnowledge EducationFranchise business opportunities in India - A Must read
July 25, 2017 3:18 pm

[…] the franchise business has grown rapidly in the past two decades, there is still a huge opportunity. As businesses and […]


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