Franchise vs. Small Businesses: What’s The Difference?
August 06, 2014
Entrepreneurship is the American dream. Liberty, prosperity, autonomy–nothing better embodies our national spirit. In fact, many Americans equate career success with owning a business, or “being your own boss.”
So, why are small business owners a minority in America? For one thing, the risks of entrepreneurship are high enough to deter many would-be startups. To put it bluntly, most small businesses fail. About 15% remain solvent, and even fewer become profitable. Legal issues, training costs, real estate, and other unanticipated expenses can sink a good business model before it gets started.
But don’t worry – you don’t have to spend your life working for the man. There are many types of small businesses, and some are less risky than others. In fact, the model with the highest level of success is the franchise. These are usually very successful, as compared to a traditional startup.
A franchise is a chance to own your own business, hire a staff, and generate income for yourself–just like a startup. The difference is that in franchising, someone else owns the brand; whereas in a company like Facebook, for example, the brand is property of the entrepreneur, Mark Zuckerberg. Some famous franchises include Subway, Maaco, and Marriott hotels. In fact, 40% of all American retail businesses are franchises.
Another major difference is that some studies show that 90% of franchise businesses succeed. Why is this number so high? Because the Federal Trade Commission has established rules, requiring the company who owns the brand to provide training and assistance to the franchisee. Think about it: training costs money. Establishing a brand costs money. A franchise business is relieved of those expenses, and can come out ahead.
At our company, U.S. Lawns, we take this a step further. Assistance is not just a legal obligation; it’s part of the relationship we have with our franchisees. We assign everyone a personal business coach, or Franchise Advisor. We encourage our 270+ franchise owners across the country to share information with each other. As the old saying goes, go in business for yourself, not by yourself.
Another major difference between startups and franchises is marketing. Entrepreneurs spend countless hours trying to build their brand recognition. A franchise is already established. At U.S. Lawns, our brand is consistently recognized in the commercial grounds care world. We’re the largest network in the country, with locations in 43 states. We’ve been in business for over 25 years, and are ranked at the top of our industry by Forbes, Success Magazine, and Entrepreneur Magazine. What’s more, we help you market the brand with an arsenal of tools like brochures, direct marketing, and digital strategies.
Finally as a franchisee you’ll be exposed to ongoing education about your business and products, as opposed to being left to figure it out yourself. At U.S. Lawns, we don’t even require that our franchisees have previous landscape experience. That’s because our required education programs include training in horticulture, agronomics, quality control, routing and scheduling, bidding and estimating as part of our training program.
If you’ve always wanted to take hold of the American dream by owning your own business, consider franchising as an alternative to the risks of a startup. The long-term cost is lower, the chance of success is higher, and there’s someone to guide you along the way. And if service to others is something you value, you might be the perfect owner of a U.S. Lawns business. Plenty of franchise opportunities are available with us. To learn more, contact us today.