Franchise Types You Need to Know

When we talk about franchising, we can break down franchising into two different types. You have your service types of franchises, and then you have your retail type of franchises. There are important factors to consider with both franchise types.?

Let’s go over them quickly to help you start thinking about which franchise type may best suit you.

Retail

For retail, just based on the name, you can assume that it requires some type of retail location. Everything from fitness, to food, clothing, wellness, spas, etc. If it requires a location it’s retail. Generally, when we're taking a look at retail type of businesses, you have to expect that the total initial investment is going to be higher because there's more pieces that need to be put together before you open the franchise.?

For instance, when you're looking at retail, you have to take into consideration that you have to find a location. You have a build out or construction of the location. You're going to have some inventory that you will need to open the business, some fixtures, some furniture, and chances are several employees so that you can cover all the shifts of your retail location.? Most retail businesses are open Monday through Sunday and therefore you will need several employees to work those shifts and at least 1 manager to manage the employees, unless you plan to work the business full time and take on the role of the general manager.? Most franchisees prefer not to work the business full time so they will hire a manager.? This also means that in terms of total initial investment you have to include a significant salary amount for your manager and this is another reason why the initial investment for retail is going to be higher.

Service

On the flip side, when you're looking at service types of businesses, generally, they may be easier or faster to get up and running because there's fewer things to consider and fewer moving parts. There's no retail space necessary in most cases, so no build out or construction will be necessary..?

Generally, with service businesses you can either office from home or maybe it takes a small warehouse office where you can keep your equipment and your tools that you need for your technicians to be able to perform the function of the service that your business provides. You can start a service business with one to two employees, one vehicle that the employees use to go on their service calls and it’s not always necessary to hire a manager if? you are the one overseeing the operation of the business.? As an owner of a service business you are not the one performing the function of the business, but you’re overseeing the operation of the business, managing the technicians and acquiring contracts to provide the service.? You take on an executive role in your business. Your role is to grow and develop the business.? Implement marketing strategies, and be the face of the business at networking events.??

If you're interested in learning more about franchising and the different types that there are, click on the link below and let's schedule some time to talk.

www.calendly.com/clardizabal