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Should I Open a Franchise or a Sole Proprietorship?

Should you choose a Franchise or Sole Proprietorship? - storefront

Which is best for you?

Today’s post comes courtesy of business contributor Jared Morrison

There is a common understanding that franchises help people cut down their advertising cost as compared to a business that is privately owned by a sole proprietor. A sole proprietor always has to start from scratch to establish its business. In sole proprietorship, many of the businesses are the kind that the general public doesn’t know much about or isn’t aware of. However, in franchises the business is already established and you pay the owner of the franchise a specific amount for using the brand name, also known as rights of usage.

Sole Proprietorship

A sole proprietorship is where an individual or a group of people start off from point zero and must embark on much effort to accomplish their business goals. It takes a great deal of time and patience equal to human effort and finance to have a proprietorship started. A sole proprietor would have to get the brand name registered, get a logo designed, and would bear sole responsibility for introducing products/services to the target market. This would, of course, require a large amount of financial and time assets.

A sole proprietor usually must shoulder greater stress on getting things done. In most cases, it’s a difficult journey to figure out a way to attract customers. Having financial resources doesn’t always help, but having a support network of trusted colleagues and friends is essential.

Why go to all the trouble then? Control. Ownership. Flexibility. You keep all the money you earn, you own everything, and the only person you answer to is yourself. The success and failure of your business is completely in your own hands.


If you have enough money and you don’t want to go under the stress of what a sole proprietor goes through, than opting for a franchise is the best option. Usually this works well when you start a franchise of some highly renowned brand, for example, Pizza Hut, Armani (Clothing), and McDonalds. These businesses have been established over several decades and people have an established demand for their products & services. Marketing and good PR for the business is conducted by the actual brand owner and the franchisee doesn’t have to worry about attracting customers.

Drawbacks of Having Either of Them

If you start as a sole proprietor, you will need to go through intense stress and will have to spend more than you probably think. You are the core person who has to take care of everything from top to bottom. But in the end, everything is yours to own and control. On the other hand, you would have to pay a handsome amount to the franchisor every month regardless of your making any profit or not. There are many rules and regulations in franchising. Most importantly you would be bound to maintain the image of the franchise and you would be bound to offer products the way the franchisor would want. However, the franchise path can be easier with an established brand and procedures already in place with a proven business model.


About the Author

Having a core understanding about different business aspects, Jared Morrison enlightens readers with thoughts regarding any business activities. Jared is associated with http://www.papersville.co.uk/custom-essay-writing-services/ which is one of the leading business and coursework assistance providers in the United Kingdom.


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Author:Globial International Business Team

The Globial International Business Team researches, analyzes, and reports on all things related to global trade and business.


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