By R. Scott Sutton
When most Americans think about successful entrepreneurs, they envision highly ambitious and fiercely independent types who develop their own concepts from the ground up.
What about the franchisee? Can you be both a franchise owner and an entrepreneur?
In years past, you might be correct in assuming that since a franchisee doesn’t come up with a new idea and strike out on their own to build their business, they aren’t technically an entrepreneur. But with the steady growth of franchising and with new franchise concepts entering the market every year, franchisees have the chance to work as entrepreneurs to build a local business with support and proven business model.
This is especially true of home and property service franchises. This franchising sector has grown significantly over the past two decades providing entrepreneurs with a choice. They can stick with the higher-risk traditional approach of doing it on their own or develop their own way within the franchise as an entrepreneur-minded franchisee.
Insights and Innovation
One of the criteria that defines an entrepreneur is that they have often developed the concept, the brand and the operations model of their business from the ground up. In franchising, however, the concept has already been developed and the business model has been established and has proven success.
In newer franchises, however, franchisees can be instrumental in assisting the franchisor with the development of the brand. From branding and advertising, to training and support programs, they help refine the brand and its foundations.
As interest rates stay high and the real estate market competitive, more homeowners are looking to invest in the home they already have, increasing the need for home and property services.
This increased demand for professional home services to maintain or increase a home’s value has resulted in an increase in the number of home and property service franchises. These new franchisors may not have all of their programs completely fleshed out, providing franchise owners with the opportunity to provide local insight as these processes are being developed.
Risk and Reward
One of the most standard definitions of an entrepreneur is the fact that they take risks., but so do franchisees. They take a financial risk when they invest in a franchise of their choice. While it may be more of a calculated risk, a franchise owner still takes on the responsibility of business ownership.
That doesn’t make the reward any less appealing. Home and property service franchises generally have a lower initial investment, reduced operating costs since many don’t require a brick-and-mortar building, and some established credibility.
For the entrepreneur who is on a tighter budget, this kind of partnership is especially appealing. They can run a lucrative business, develop their own local marketing plan, hire their own employees and set their own hours while having the backing of a reputable company as a life preserver.
Scalability and Growth
Finally, for the home and property service franchisee, the ability to scale their business is entirely up to them.
By using the marketing playbooks, collateral, and practices often provided by the franchisor, franchisees can choose their own adventure choosing to scale their business as their desired rate. If the franchisee is especially eager, he or she can also choose a franchisor with a family of brands that complement one another. For example, if the franchisee first buys an irrigation company and makes it a success, they can then add on another brand offered by the franchisor to expand their services. If their franchisor also offers an outdoor lighting or lawn care company, combining that with their irrigation company will expand their target customer profiles.
While it’s true that franchisors do place some physical limitations on their franchisees by offering well-defined spatial territories, that doesn’t stop successful franchisees from becoming multi-unit franchise owners, too.
If a franchisee owns a territory in their town, they can later purchase neighboring territories and expand their outreach.
The sky can be the limit in franchising just as it is in traditional entrepreneurship.
Entrepreneurs and Intrapreneurs
Many franchising companies often have two kinds of franchise owners: those who are happy to buy into the brand and work the system, and those who work the system but also want to contribute to its ongoing innovation and development.
A good franchisor will have both kinds of franchisees and will understand the motivations of each kind. Having a combination of the “intrapreneurs” who serve as advocates of the process and the entrepreneurs who drive growth is a powerful testament to the flexibility of your franchising group.
There will always be those entrepreneurs who want to work in the traditional sense by starting their own companies and developing their own operating processes, and they may find the franchising system restrictive, but there are some entrepreneurs who can get complete satisfaction from working within a franchise system by channeling their entrepreneurial spirit toward innovation, reward and growth.
- Scott Sutton serves Empower Brands as its Chief Development Officer, responsible for the franchise development strategies, initiatives and tactics across the company’s 10 franchise brands. Scott’s leadership and strategic experience is extensive and diverse. During his more than 30-year career, he has led mergers and acquisitions strategy, franchise development, and new brand incubation functions in publicly traded and private equity backed businesses operating within the B2B products, petroleum services, childcare, home services and retail segments.
For more information about Empower Brands, visit https://empowerfranchising.com/.