Why choose an Accountancy Franchise over starting your own business? Back
Franchising is effectively a business agreement between 2 parties – the franchisor and the franchisee. In return usually for an initial fee and then ongoing fee, the franchisee is granted the rights to operate a business using the franchisor’s name, business model and marketing rights, for a predefined and contractually agreed period of time.
What are the Pros and the Cons
You are buying in to an established ready-made brand, which will normally have an existing successful format, business model and reputation . As it is already a proven idea, there is obviously less risk than with other startups. Finance therefore may be easier to come by as banks can be more willing to lend to a franchise with a good name and reputation. You will receive initial and ongoing mentorship and support from the TFMC. you will receive training, marketing and advertising, product development and management support.
It can often expensive – with perhaps an initial upfront fee and then ongoing fees which could include a percentage of turnover or profit. You may be responsible for the day to day running of the business but some decisions are out of your control – for example product ranges or pricing could all be decided by the franchisor. Despite all your own hard efforts, your own brand reputation could be tainted by other franchisees’ poor performances, that's why we thoroughly vet all our franchisees and monitor performance and standards. In doing so, we protect our brand and your future investment.
A proven business model
Accountancy Franchise – the main benefit of buying an accountancy franchise is that you are buying into a proven formula.
Independent business - your business will be totally unproven. You can look at competition to see how well they are doing to get an idea of the market but it is difficult to compare without matching like for like and you could spend a lot of money making mistakes that a franchisee will avoid.
Franchise – as a franchisee you will have the right to use the franchisor’s established trade name, marks, logo and style. Though the franchise can be national, customers will be aware of local ownership - their brand will be well known and developed and their website will already rank in Google for your area. Try searching Google for "Accounting Franchises Manchester", for example.
Independent business – you will need to establish your own trade name which can take time. The name will not be national throughout the UK but customers will be aware of local ownership and you will be marketing online from scratch. A recent online marketing study showed that it takes, on average, 2.5 to 3 years from going live for a website to get onto Google's first page. The internet is such a big part of everyone's lives now, this factor cannot be underestimated.
Known product or service
Franchise – as you are part of a larger network, your product/service will have wider public acceptance in the UK. Your reputation however will depend on the network. If the network as a whole has a good reputation then your product will be accepted as being one that is trustworthy. If a franchisee performs badly and gets negative reception, then you may be tainted with the same brush.
Independent business - it can take a long time to establish a product/service and build up public acceptance. It is also more difficult to compete with larger brands such as a TFMC franchise.
Franchise - a franchise is a business that has transferable systems and skills. This means that a franchisor will train franchisees in all aspects of running their franchise business. You therefore do not need experience in the particular industry.
Independent business – the business you decide to set up will be limited to your skills. As no one is training or supporting you the success of your business will depend on your own capabilities.
Franchise – you are buying a turnkey business franchise format, i.e. you should be able to start trading successfully from day one.
Independent business - as you will have little external support your business will start small and will require time to develop.
Franchise - you will contribute to a monthly advertising fund that allows the franchisor to advertise the brand nationally. As it is a group fund they can negotiate favourable rates, it also means that you are able to undertake professional marketing campaigns.
Independent business – the marketing you do for your business is entirely down to you and your skills. You are responsible for devising and producing your own material and selecting the best media. You therefore need to have some knowledge of marketing. It is also unlikely that you can afford to undertake professional campaigns but you are able to build up local awareness.
Franchise - franchisors will specify suppliers for you to use in order to keep conformity in the network which can allow you to take advantage of group bulk discounts. It does however mean that you are restricted to using their suppliers and not able to look for cheaper supplies elsewhere if they exist.
Independent business - you are free to specify your own materials and to shop around to get the best deals. Initially you will be buying in small quantities and therefore the discounts will be small.
Ongoing help & support
Franchise - you will have the benefit of a trouble shooting service from the franchisor as and when required. Field staff may also visit franchisees and help prevent the build-up of problems; this is especially valuable at the launch of your business.
Independent business – you are on your own with no visits from a support team
Franchise - the franchisor will help to select or advise on location in the UK that is right for your franchise business. They will have access to demographic reporting tools that will help them to establish these locations. A reputable franchise is also able to negotiate with landlords and sellers to get better locations and rates.
Independent business - you are free to make good or bad choice of location. Expert advice can be obtained but can be expensive.
Deciding whether to go with the relative safety of a franchise or starting a business alone is a often a personal matter - at TFMC we can provide training and support to people with all backgrounds, all we ask is that you give us a call before you make a this important life-changing decision.