Last Updated: Feb 18, 2017
Buying a home-based franchise could be your ticket to having your own home business. But how do you know which ones are legitimate, and how do you choose the one that’s right for you? Use these tips to analyze home-based franchise opportunities so you make the best choice.
You think you’ve found the perfect business, but you’ll have to run it out of your home. Additionally, you have to buy the business rather than start it from scratch. That’s not a bad thing, let’s distinguish between a franchise and a business opportunity.
Business Opportunity or Franchise: What’s The Difference?
There is a distinct difference between a franchise and a business opportunity. Let’s examine briefly what they both entail.
A franchise is a licensing agreement with an existing business to operate under that business name. For instance, Vanguard Cleaning Systems is a home-based franchise in the commercial cleaning sector. If you were to purchase a franchise with this company, you would be operating as Vanguard Cleaning Systems and acquiring your own customers under that company’s name.
A business opportunity typically requires an upfront investment, though not always as big an investment a franchise. However, you are not adopting a business identity as with a franchise.
Many network marketing opportunities are considered business opportunities because you acquire the right to sell products and recruit members but do not adopt the name of the parent organization. You operate your business in your own name while representing another company’s products. Other types of business opportunities include vending Machines, import-export businesses, and wholesaling.
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Be Prepared To work Hard
The most important thing to understand about buying a home-based franchise is that you are buying a job. If you are not prepared to work hard, you should consider other options.
Unlike a typical franchise—say, for instance, a fast food restaurant—you will not commute. That means you’ll need some discipline. You may be tempted to lie in bed an extra hour or not treat your franchise like a real business. It will require an extra amount of diligence to ensure that you tackle the challenges of running a franchise from your home.
Since you can’t expect to treat your home-based franchise like a location-based business, it is imperative that you be involved in every detail of your business right from the get-go. You cannot just hire a manager to run the daily operations. If you are not prepared to be heavily involved in the day-to-day operations of your business, then a home-based franchise is not for you.
How to Identify the Right Home-Based Franchise for You
Buying a home-based franchise is an investment. Therefore, you should analyze the potential for a return on your investment. don’t go into it emotionally blindfolded. Think like a business professional.
What should you consider as you analyze home-based franchise opportunities?
It is important to perfORM your due diligence. don’t make important business decisions on emotion. If necessary, hire a franchise consultant to help you evaluate your opportunities. don’t just choose a home-based franchise because you think it will make you money. If you lose interest, you’re stuck with your contract and obligations to the franchisor.