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Myths and Facts About the Success of Franchises

However, the word “franchise” sometimes carries negative connotations, possibly due to associations with large retail and food chains whose quality has been questioned over time. Nevertheless, there are numerous examples of franchises that operate successfully and with high quality.
Launching a franchise can be a great way for a new entrepreneur to “break through,” while keeping initial investments significantly lower than starting a business from scratch. Additionally, they receive a form of guidance from the franchisor, which can include the entire business plan.
Let us debunk some of the myths about franchising and highlight the facts that show just how accessible and profitable franchising can really be!

Myth #1: Location is everything

Let’s draw a parallel with talent – a person can have a lot of talent, but without enough effort invested, that talent won’t yield results. It’s similar with business. You can open a location in the perfect spot, but if customers/clients see that what they receive isn’t of sufficient quality, they won’t return. Or worse – nowadays, in just a few clicks, a negative review can be left that has the power to build or destroy a reputation.
What will attract and retain customers is the quality of the product paired with good marketing. In other words, it is often better to invest money in product quality rather than in higher rent for a business space in a busy or overly popular location. On top of that, you might even save on rental costs!

Myth #2: You have to be an expert

The good thing about opening a franchise is that the franchisor, i.e., the owner of a particular brand, often provides training and education. You will have plenty of opportunities to get acquainted with the brand, its vision and mission, business strategy, and so on.
To start, it is perfectly enough to have some basic knowledge of the brand and know why you specifically want to open a franchise under it. The rest is learned on the go. Willpower, motivation, a strong work ethic, intelligence, and resourcefulness matter much more for an entrepreneur than formal education.
After all, being an entrepreneur (and in a way your own employer) means you must always be willing to develop yourself and learn new things. This can be very motivating!

Myth #3: Success is guaranteed

So far, it may seem like everything is handed to you when you start a franchise. However, that’s not necessarily the case. Ultimately, it is your business. Operating under a recognized name gives you an initial advantage, but it’s up to you to continue developing the business—of course, in line with the brand’s identity.
Although you will have support from the franchisor from the start (especially during the first 90 days of launching the franchise), in some franchise models they may even provide you with a ready-made business plan, it is up to you to execute that plan. As with any form of entrepreneurship, risks and unforeseen circumstances exist, but this shouldn’t hold you back. You can control much more than it might seem.

Myth #4: You Have No Control

You can view the franchisor’s instructions as guidelines. As long as you remain loyal to the brand and follow the contract, you have freedom in other matters. You will independently find quality employees, build a customer base, and manage your finances.
As you grow and become more independent, you will be able to negotiate with the franchisor about the level of autonomy in your business, set and align goals, and develop quite independently.
Now that we have identified four main myths and busted the taboos, it’s time to give you some added support on your entrepreneurial journey. Keep these facts in mind as you continue to consider the direction of your career.

Fact #1: People of all income levels can start a successful franchise

With the initial moral and financial support of the franchisor, starting your own successful franchise doesn’t have to require huge expenses. Entrepreneurs, or franchisees, can come from various backgrounds. Don’t believe in stereotypes.
As we emphasized earlier, motivation and persistence are far more important than talent. Money cannot buy motivation, intelligence, or passion for what you do.

Fact #2: Franchise opportunities are everywhere

Although some of the world’s most famous franchises operate in the food industry (McDonald’s, KFC, and Burger King are surely familiar names to you), you are not limited to just that.

Today, more and more franchises in other industries are opening, such as hospitality (Marriott International), real estate (RE/MAX), accounting (H&R Block), fitness and gyms (e.g., Orangetheory Fitness or Anytime Fitness Inc.), and so on.

Additionally, in recent years, Croatia has recognized the need to encourage entrepreneurship, leading to the development of support programs for new employment and self-employment, which also include the purchase of a franchise.

Fact #3: Franchises are a long-term “commitment,” like a marriage

The comparison to marriage is appropriate in this regard, but it’s still important to keep in mind whose brand is actually at stake. In a way, the franchisor “brings” much more to the relationship and holds certain advantages. However, this is not a disadvantage, because thanks to the franchisor’s experience (and finances), it is easier to start the business and manage it successfully.
Just as you wouldn’t enter into a marriage lightly, it’s important to carefully consider signing a franchise agreement. It’s wise to have legal support and consulting, familiarize yourself with the franchisor’s financial (dis)positions, and assess the profitability of entering such a business relationship.
You can also find support by collaborating with the company CFCG, which offers specialized franchise consulting based on market experience and needs. Seek assistance in developing a franchise business model, standardizing business processes, preparing franchise documentation, and numerous other aspects of franchising.
After signing the franchise agreement, a strong bond is formed between the franchisor and the franchisee. Although both parties retain a certain degree of independence, they share intellectual property and brand identity. This can work to your advantage if you know how to choose the right franchise.
Being an entrepreneur means being bold—and independent. So don’t rely on what others say or the myths that circulate. Dare to venture into franchising, build your own business, and see for yourself how rewarding it is to succeed in entrepreneurship!

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