Franchise or own office: which option to choose?

If you intend to invest in the health market, you must have already faced the following dilemma: opening a franchise or own office? Opening a business in the industry, in the midst of so much competition, requires planning, and making that decision is one of the crucial points for you to be successful.

For this, it is necessary to know the pros and cons of each model and understand what type of venture is best suited to your objectives and your investor profile.

In order to facilitate the decision, we created this text that aims to illuminate your choice process. Read on and find out the main features you should analyze before hitting the hammer!

Advantages of opening a franchise 

Consolidated brand in the market 

Perhaps the biggest advantage of opening a franchise is being part of a brand already known in the market. After all, building a company’s credibility from scratch is a slow and laborious process. The franchise offers the opportunity to embark on a reputable business, which gives more security to the investment made by you.

Of course, it is necessary to research thoroughly to join a franchise that has a good image and can offer advantages to its customers. In fact, joining a franchise, it will not be difficult to establish a loyal and extensive clientele.

Constant disclosure 

Advertising your office is essential if it is to reach a large number of potential clients and prosper. This is expensive and requires expertise so that the disclosure is carried out in the most appropriate manner, making the conversion as large as possible.

In franchises, an advantage is that part of the billed amount is already used for marketing, customer acquisition and branding campaigns, which are carried out frequently. So, you don’t have to worry about advertising or spend anything else on it.

More security

According to a survey by Rizzo Franchise, only 3% of franchises do not survive the first year of operation and close their doors. Meanwhile, considering the same period, 23% of small open companies fail. Therefore, investing in a franchise offers more security to the investor.

After all, you will be betting on a business model that has already been tested by both the franchisor and the other franchisees. All the know-how of the brand will be in your favor, increasing the chances of positive results.

Ease of administration

As for the management of your franchise, you will not have many difficulties. After all, franchisors take care of the administration, finances and marketing of all units. Thus, it is possible to focus on your work without worrying about managing the business or hiring a specific professional to perform this function.

In addition to these benefits, you will also receive advice on where you plan to set up your practice and how to train employees. You will also have access to an extensive register of suppliers who will be willing to offer a series of advantages , such as discounts for the requested quantity of material and more flexible payment terms.

Disadvantages of opening a franchise

High investment

In addition to the initial amount required for you to enter the franchise and use the brand name added to all benefits (management by the franchise, unified marketing etc.), you will also need to pay a monthly royalty percentage, which normally varies between 5% 10% of monthly profits.

It may seem disadvantageous, but it is important to keep in mind that, when you join a brand already known to the public, you enjoy its consolidated structure and reputation, increasing the chances of monthly revenue. In addition, the amount spent monthly with the franchisor would probably be allocated to issues such as marketing and management, services that are already ensured by the brand.

Less flexibility

When entering a network, the investor will need to adapt to the processes and rules proposed by the franchisor. Even if the relationship between the two sides is the best possible, the franchisee needs to keep in mind that there will be constant control over the operations performed by the office . After all, the company has a standard to watch over.

Advantages of opening your own practice

Management autonomy

For those who are in doubt as to whether it is better to open a franchise or own office, it is important to know that, in the second option, you will have a high degree of autonomy in all stages of the process. The investor will be able to decide on the brand positioning, the business management, among other aspects.

Of course, all of this is going to be much more work and, in order to continue to be an advantageous aspect, it is essential to seek qualification so as not to make mistakes when opening your office. Remember that autonomy requires responsibility and constant training.

Personalized service 

By opening your own business, you can define opening hours and have more flexibility in your day to day. If you need to work in the franchise and also take care of the administrative part, the time spent on each task will be defined only by you. In addition, there is also more freedom to adapt to customer demands: you do not need authorization to implement news.

Disadvantages of opening your own practice

Higher risk

As we said before, the chance of a business of its own failing is greater than that of a franchise. One in four new companies in Brazil go bankrupt before they turn two. Therefore, it is necessary to try hard not to be part of this statistic.

You will not be supported by a franchisor to deal with bureaucratic and financial aspects. Functions like paying taxes and managing marketing, for example, will be yours. So be aware that the responsibility for the success of the business is yours alone.

Unpopular business in the market

When opening a company of your own, it is necessary to keep in mind that your brand will be a newcomer among many others already consolidated and that customers will probably prefer to bet on a service that already has a built credibility. To open up the market and build your loyal customer base, you will need a heavy initial investment in marketing.

Now that you know the advantages and disadvantages of opening your own franchise or office, is it easier to make your decision? If the choice is for the first type of enterprise, the good news is that this model is expanding in Brazil and achieved growth of 8% between 2016 and 2017.

 

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