Franchise vs. Independent: Which Is Best?
Dreaming of financial freedom and flexibility to make your own decisions? Deciding what business model to pick can be challenging. Learn more about the pros and cons of opening a franchise vs. an independent business so you can make a choice that fits your vision.
Small businesses strengthen local communities by providing valuable services and employment. They drive innovation and community growth. At least 86% of Americans believe small businesses have a “positive effect on the way things are going in the country these days,” Pew Research reports.
In addition to helping communities thrive, small businesses also provide a path to financial independence for entrepreneurs. Owning a small business is a chance to build wealth, control your future, and create opportunity.
Pros and Cons of Franchise vs. Independent Businesses
To get started, you’ll need to determine if you want to open a franchise or start a new concept on your own. Let’s make a side-by-side comparison of the pros and cons of each business model.
Independent
If you have a big idea for a concept with a unique selling proposition, independent business ownership might be the right path. You’ll be in charge of your destiny and your success rests entirely on your shoulders.
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PROS |
CONS |
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Unlimited growth potential: A startup business is not subject to territory restrictions, and you can add new locations on your timeline. |
High customer acquisition costs: As a startup business, building trust and acquiring new customers is costly and takes time. |
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Full creative control: You get to make every decision about operations and target market. |
Uncertainty: With a new, untested concept, there is a higher risk of failure. |
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No fees: You get to keep your profits. |
No built-in support: You don’t have an established system of support and will need to find a mentor on your own. |
Franchise
A franchise is a business model where an entrepreneur buys the rights to operate a business using the branding, products, and systems of an established company. There are many advantages of franchising, particularly for new entrepreneurs.
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PROS |
CONS |
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Proven brand: A franchise has experienced success in other markets, reducing the risks associated with launching a business. |
Ongoing fees: Franchisees are required to pay initial and ongoing fees for the right to use the brand name and operational playbook. The amount of royalty fees you’ll need to pay is typically based on gross sales. As part of your fees, you’ll receive ongoing guidance and support from the franchisor. |
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Brand recognition: A franchise comes with a built-in reputation, making it easier to build a loyal customer base and generate leads. |
Less creative control: You need to adhere to brand guidelines. Although this can limit your ability to innovate, it removes guesswork and enables you to focus on growth. |
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Training and ongoing support: A franchise provides comprehensive initial training to give you the tools and education you need to run a successful business. Support doesn’t stop when you open. |
Vendor and supplier restrictions: Many franchisors require you to purchase supplies from pre-determined vendors. While this can be limiting, you can take advantage of group buying power to lower costs. |
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Marketing assistance: Most franchisors have a national marketing strategy, local marketing toolkits, and robust online advertising solutions to help each location add customers. |
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Easier to finance: Securing financing for a recognized brand can be easier than a startup. Lenders are more likely to fund a brand that has a track record of success. |
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Your Franchise Journey Begins Here!
Franchise vs. independent? The choice is clear. If you want to launch a business with a knowledgeable partner, a franchise is your best bet. Nearly 95% of franchises with an initial investment of $25,000 or above are still in business after five years, Entrepreneur reports.
Kitchen Tune-Up is a niche home remodeling franchise. We have more than 37 years under our belt helping new entrepreneurs achieve their business goals. You don’t need contracting experience to hit your targets as a Kitchen Tune-Up franchise owner. We provide the tools, training, and ongoing guidance you need to serve customers in your community.
Inquire now to learn more about how you can join the $509 billion home remodeling industry with Kitchen Tune-Up.