By Ward Morrison, Motto Mortgage President
Franchise ownership offers many benefits when compared to going it alone as an entrepreneur. You’ll have a franchisor supporting you through the entire process; a coach cheering you on. You’ll have established systems and a network of expertise.
These overarching advantages of owning a franchise serve business owners well. But let’s dig a little deeper. Why choose to own a franchise?
Traditionally, there are 4 essential advantages of owning a franchise:
- Unique product or service
- Group purchasing power
- Industry and business training
- Established brand
Today, I would add a 5th factor: technology.
Unique Product or Service
When it comes to owning a business – whether a franchise or not – uniqueness of product can be essential. If your offering doesn’t stand out in the market, you may have a hard time making it work. One benefit of franchise ownership is that the product or service niche has already been established for you.
Another component of uniqueness that is often overlooked is the ongoing innovation and creativity produced by the franchisor. The franchisor is often out there researching the tech for network locations, creating systems that implement regulatory changes, and crafting or seeking out new products that keep network offices top of mind with their customers.
Burger King®’s new (meatless) Impossible Whopper® is a great example of ongoing product innovation, as is Subway®’s new ciabatta bread option. Both were products of franchisor brainstorming to support the goal of driving more customers to the branded franchised locations.
Group Purchasing Power
This valuable component of franchise ownership applies to everything from technology to t-shirts and the advantage comes down to economy of scale. Franchise networks consisting of multiple locations often demand larger quantities of a product and reap the reward of lower cost per product because of it.
Take McDonald’s© as an example. Their industry-leading purchasing power allows them to obtain ingredients (such as potatoes and beef) at a cost the mom and pop burger shop down the street can’t. That’s simply because they buy so much of it.
Industry and Business Training
At Motto Franchising, LLC we call our Motto Mortgage franchise model a mortgage brokerage in-a-box.
This approach to business creation allows entrepreneurs who may know little about mortgage or even business ownership to open a compliant mortgage brokerage office more quickly than doing it on their own.
Industry and business training at this level require a sizeable investment by the franchisor. However, this is an essential benefit of purchasing a franchise as an entrepreneur.
Established Brand
Brand recognition requires tireless effort on the part of marketing staff, as well as hefty capital contributions toward advertising campaigns and other brand awareness initiatives.
Most franchise systems require the payment of fees for a national advertising fund. This focuses resources and amplifies marketing impact, increasing brand strength.
I often ask potential franchise owners if they want to be part of a nationally recognized brand or a mom and pop brand that may not even be known outside its own walls.
Industry Leading Technology
In this day and age, business is driven by tech. Whether your business is sandwiches or mortgages, advanced technology is a key component of the business.
Imagine a nationally recognized sandwich franchise network competing without a user-friendly online ordering system or functioning without high-tech cash registers.
The same is true for the Motto Mortgage network of offices. We provide each network office with highly-integrated, leading edge technology for use by franchisee personnel as well as their customers.
A franchise location should have access to systems more advanced than the typical independent business.
When Owning a Franchise Might Not be for You
While there are many advantages of owning a franchise, it may not be for everyone. The powerful branding often offered by franchise systems is just one side of the coin. The other side of that coin is that franchise locations can become homogenous.
If you already have a unique idea that you believe will be profitable (plus the systems, business, and marketing know-how to make it happen) you might decide to go it alone. Then, if you’re successful, you might consider selling it or franchising it!
My Advice for Future Franchise Owners
1. Go to every training the franchisor offers you. Jump on every training call. Watch every video. Learn your business inside and out.
2. Reach out to the network of franchise locations when you have questions. You have a potential built-in support community when you join a franchise network.
3. Identify who the established owners are and get in touch with them. As long as they’re not doing business in your town, they’re likely to be willing to share their tips and tricks.
This information is not intended as an offer to sell, or the solicitation of an offer to buy, a Motto Mortgage franchise. It is for informational purposes only. We will not offer you a franchise in states or other jurisdictions where registration is required unless and until we have complied with applicable pre-sale registration requirements in your state (or have been exempted therefrom) and a Franchise Disclosure Document has been delivered to you before the sale in compliance with applicable law. New York residents: This advertisement is not an offering. An offering can be made by prospectus only. Minnesota Reg. No. F-8089; Motto Franchising, LLC, 5075 South Syracuse St #1200, Denver, CO 80237, 1.866.668.8649.
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Published on October 8, 2019
