Franchising vs. Licensing
Franchising vs. Licensing Which Road Will You Choose? You're not in Kansas Toto, and there is no wizard of coffee on the yellow brick road that leads to success. Worst of all, there are no coffee business experts, secret systems, franchise concepts or licensing agreements that can guarantee your success in the wonderful land of coffee shop / drive-thru businesses.The buck stops and starts with you... Literally! It's your HARD EARNED money. You are going to need to get up to speed quickly and learn a lot of new stuff, including "COFFEE TALK". Get ready to do your coffee business homework, so that you can minimize your risks and prevent "beginners" mistakes that will destroy your chances for success and could cause your profits to be eaten by the wicked witch of the west? Even though the coffee drive-thru, coffee café, kiosk, and coffee cart segment of the industry is booming, you still have to do your part to maximize your probability of success. The best way to guarantee this is to follow the same tried and proven pathway to success that is working for hundreds of coffee drive thru owners across the nation. Our natural human desire is to model success, and that is why franchise and licensing concepts are so attractive to most people. After all, it is very reassuring to know that the people running a coffee franchise concept will advise you on a location, design your building, advise you on equipment, help you choose your products, create your menu and even train you in one of their successful franchisee's coffee drive-thrus, coffee cafés, coffee kiosks or coffee carts. Is licensing the best way for you to get back to Kansas? Being a part of a licensing company has its advantages, the biggest being the freedom to personalize your store - making it unique. A licensee can change their business into anything and everything that they want their store to be. They can offer any product they want, set their own hours and advertise most advantageous to them. The only problem is...the rest of the licensees also have to live with their fellow licensees decisions. Therefore, the greatest single advantage of being a specialty coffee license owner becomes a big problem for many licensee owners. Other owners can run their business poorly or change their menus and products in a drastic way that could affect your own licensed business. Their bad decisions could reflect on you and your business, costing you customers and profit.
There may be a better way.
The popularity of coffee franchise businesses comes from the established record
of success. With national and international growth there is an ease inherent in the franchise system that naturally develops into success. Each coffee franchise draws off of each other in the local and national market. A franchise business remains consistent so that when a customer sees your franchise they know that it will be able to offer them the same great products and services that they received at other franchise stores.
Most people view the franchise fee as a negative, but this fee actually improves their chances for success in a big way. Franchising offers an attractive alternative to the licensing business. Unlike a licensee, a franchisee benefits from training, assistance with location selection, store design, construction programs and reduced cost of products. Franchisees also have access to a professional consulting service, as well as being able to take tips from a network of other franchisees.
Another incredible benefit of buying a coffee franchise instead of a license is the value associated with a nationally known franchise. Having a national or international brand behind you and your business provides constant advertising and promotion for your personal store. A franchisee can also be assured that the entire network of other franchisees will be run in a manner that will not harm their own business.
The risk involved with buying a coffee franchise is significantly lower than buying a license. A franchisee has an enormous base of professional support and proven research to build on and lead them in the right direction throughout their business endeavor. Quality coffee franchise companies provide proven track records of an established brand, consistent business, steady growth, and success.
So if you want to take the more secure road to get you to your destination, look to a coffee franchise for support, encouragement, and a great way to fulfill your dream.
How to Pick A Winning Franchise.
Cuppy's Coffee, Smoothies & More Franchises are leading the coffee, smoothie and juice bar business to new heights!
With our system, Cuppy's Coffee is giving the competition a run for their money.
There are so many important factors to consider when it comes to franchising. If you are thinking about buying into a franchise, you must invest the time into research everything you need to know. You want to make sure you are investing your money in a smart franchise that works for you. This is not always an easy process, but it's important to do your research and consider all of your options.
Here are some things you need to consider if you are thinking of stepping into the world of franchising:
Look for a franchise that falls into an interest category you like.
It's best to pick a business that best matches what you like to do. Also think about the kinds of things that are important to you. You may want to work in the food service industry, but you don't want to have a lot of employees. This would lead you to a business that promotes food service with a low overhead. Perhaps a coffee drive thru or a kiosk stand in the mall. Just remember that you will work closely with your business, or at least the initial set up of you business. Do you want lots of staff? Do you want to work with goods that don't spoil? These are all things that you should consider when picking a franchise.
Understand all the fees.
Make sure you fully understand what fees are involved -- all of the fees. What products or services will you be expected to buy from the franchisor? Can you purchase products from other sources? Will they provide you with a list of names of these sources?
A legitimate franchisor is just as eager for you to succeed as you are. S/he'll carefully go over with you the costs involved in starting your business. Those costs will include not only the franchise fee itself, but a business site, inventory, insurance, equipment, wages for employees and working capital.
A proven system.
A good franchise will be able to give you information on their proven system. You need to talk to other franchises and see what they have to say about the business. Talk to more than just one person to get a variety of feedback. Have you been invited to the corporate headquarters to see how they system works and is enforced.
Brand and Name Recognition.
Successful franchises are successful because they have a strong name. Research into the company to see that they have the purchasing power that means better discounts for their franchisees. Does the brand carry all of the components needed to carry your business? Does it have the supplies associated with its name?
An effective education and training program.
Does the franchise you want to work with provide adequate training? Will you be supplied with appropriate manuals, handbooks and educational material? It's important to know that you will have the training material you need as well as the support to operate your business to it's full potential.
Articles on this page:
Licensing vs. Franchising
How To Pick A Winning Franchise