The recent economic recession has rendered a large number of people across the world jobless. Everyday we learn about various companies laying off their employees as a result of the economic recession. Such an economic situation pushes laid off workers to think about starting their own businesses. However, many people may feel that it is not a right time to start a business but many of them may not have a choice. Under such circumstances, buying a franchise may be the safest way to start a business.
Highlighting the benefits of franchising Major Rajan, Director, VETA, says, “Franchising requires lesser initial capital investment, identity in the market, immediate attention, training of employees and immediate walk-ins/sales local knowledge to sell the product/service, media support/public awareness and mentor support. Lesser risk is another advantage than setting up independently.” However, Mr NP Singh, Director (Retail projects), Samsonite South Asia Private Limited says on the seriousness of franchising, “To take up franchisee one need to have minimum capital arrangement, and also the profile/exposure to retail etc. However, yes with these basic inputs one can explore the possibility of taking up a franchisee.”
Franchising is a successfully proven system and thus compelling particularly in difficult times like this. Supporting the above statement Mr Singh opines, “Franchising is a better option for sure as the road map is clearly defined and methodology of business is well experimented in the past, so it is easy to adopt.” It required lot of hard work and rigorous efforts to establish a new business. Even after putting in your best efforts one can never be sure of the success of the business which is not a case in franchising. Franchising provides a network of franchisees, economies of purchasing, marketing, pricing, and a compelling support network. In case of independent business, the owner is responsible for his business and needs to develop his own devices to figure out a way to better run their operation during troubled economic times. However, the franchise owner has a franchisor and fellow franchisees to settle down various issues. The expansion through franchising requires investor capital, and the recent economic recession certainly offers significant investment bargains for investors who have capital or sufficiently strong credit. The most significant reason for opting for franchising is franchisees typically get up and running faster, and are profitable more quickly, which is the result of a better management as well as a well-known name.
Regarding the best running franchise sectors during recession Mr Singh said, “I do not have a specific answer when asked about current best franchise businesses but yes, relatively better option could be food, beauty/cosmetics, education etc. including growing brands like Samsonite as well!
In this regard, Major Rajan opines, “At this juncture, services posses lesser risk than products with a distinct advantage of performing better once the recession period is off. Of the services, education and training are the most preferred ones being a stimulant to the jobless and to the jobseekers to be more competitive.”
So, what are you waiting for? Beat the depression of your job loss and be your own boss. With franchising the best you can hope for is a business that’s fairly recession-resistant.
