There is a tension in entrepreneurship between start your own business from scratch and buying an established business. They both demand upfront costs: everyone needs business capital. Franchises that are already in operation will already have a clientele, and advertising slogan and advertising presence, as well as a territory within the business world. Trying to get established in any niche is very difficult and takes time. In certain niches, such as home improvement, it is exceedingly difficult.
Clients tend to develop a certain amount of loyalty to businesses that have served them well in the past. In the home improvement industry, that tendency is exceedingly strong. Anyone’s home is a tremendous asset with substantial expenses attached, and they often do not want to take any new risks with someone untried or untested. People are more likely to choose a home improvement business through word of mouth, asking friends about what good and bad experiences they have had in the past. In the home improvement business, by definition you are trying to fix a problem. People tend to be more discerning in such situations, as opposed to when they are just buying some consumer goods or engaging in other low risk business activities. Also, people tend to read online reviews when searching for a new home improvement business. Having almost no one to vouch for your services is a very difficult hurdle to get over in the early days of any business, and it is part of the risk that anyone takes when starting a new business.
Franchises also tend to come equipped with their own existing capital and employees. When purchasing a franchise, the heads of the company may change, but many of the other employees will probably stay. Hiring new employees on an untried, untested business can also be risky. Many of the most skilled construction workers with solid resumes will apply to established franchises with a solid clientele. New businesses will probably attract more new employees with less experience. Buying franchises means buying their workers’ time almost immediately.
There will also be far less lag time involved. After purchasing the franchise, new business owners will have a fully functioning business machine equipped with capital, clients, and employees at their disposal. When starting their own businesses, entrepreneurs may take years advertising, attracting and maintaining client relationships, building their reputations, and dealing with all the fluctuations of a difficult and fickle market. Anyone involved in a franchise will still have to deal with market realities, but they will do so with a certain foundation to work from, rather than having to build their own. The housing market and almost anything involving real estate is particular vulnerable to ups and downs, and still has not currently recovered. Some home improvement franchises have survived the ups and downs of recent times, and they may well continue to do so under new management. Buying a franchise is a good route into the home improvement buisness.
Tauseef Hussain is a media blogger and writes for AQVA, the on-line store for home and Designer Bathroom products. You can interact with Tauseef Hussain on Twitter @usef4u and follow AQVA @aqvabathrooms