Big Franchises Vs Small Franchises-The extent of support you should expect
If you are a prospective franchisee you should be wondering what kind of support you are going to receive when you purchase a franchise. If you took the next step to discover it, you may find that the type of support and the benefits provided will significantly vary depending on the size (big or small) of the franchise company you consider.
However it is difficult to decide one is better than the other in general. Your expectations and preferences play a key role in deciding what is ideal for you. Therefore you need to evaluate the differences carefully to determine what'll best serve your interests.
The idea of this article is to discuss the main differences between the extents of support provided by each type. For ease of presentation these differences are discussed under three main headings.
The availability and provision of resources:
One clear disadvantage of small franchise companies is that they usually have smaller budgets and access to limited resources than comparatively larger companies. Therefore you would not have access to outside training programs and materials, third party support, real estate and demographic modeling, computer programs and other technical assistance provided by the prominent franchise companies such as KFC.
However the small franchise companies are equipped with the essential support you need to succeed in your business. They tend to focus on the most important, direct, critical path items to get a new franchisee up on his feet at the lowest possible cost. This focus is in a way beneficial to the franchisee since it causes less confusion.
Both these approaches can work just fine for you. Therefore the task relies on you to find out whether you can manage with limited resources or you need extra. One possible approach is to contact other franchisees in your area and find out whether the availability and provision of resources by the franchisor were sufficient for them. Most probably if they're satisfied and successful, you too may be fine. The disadvantage of having extra resources is it is expensive.
The people and the relationship:
Of course in a larger company you may typically find people providing expert support in their respective area of specialization. The range of areas in which the support is provided is vast which ultimately means they can deal with whatever the issue you are facing, with higher expertise and experience. Though this can be a huge advantage, it doesn’t help in building a close relationship with the franchisee since he will be dealing with many people.
Considering the other side of the coin, the small companies will provide you exactly what lacks in a large company. Since there is lesser number of support personnel you'll probably get to know them much better and form a stronger personal relationship. Further you may find the support personnel you deal with in smaller companies are more senior in the organization and more willing to do "whatever it takes" to help you deal with issues.
Here again you will have to decide what approach best suits you. What do you prefer most? Is it expertise knowledge or a sound personal relationship? However you must keep in mind that the small franchise you associate today may grow and become a larger franchise one day. So on the day it happens, you can hardly expect the same vice president who used to support you in the past to come to your door step.
The flexibility of rules and regulations:
A large franchise system means a system of established procedures and practices. Most probably you will find that they have extensive and well documented rules for almost all the situations that you may encounter during your business. In addition they also have many individuals whose responsibility is to ensure compliance with all those rules. One of the advantages of it is the sense of security which the franchisee will experience. In addition it’s far less risky to either the franchisor or the franchisee.
On the other hand due to existence of lesser formalities, the degree of freedom in a small franchise system is high. Although it has sufficient amount of control exercised by the franchisor, there are fewer restrictions and therefore the franchisee enjoys the flexibility to experiment in at least certain areas. The advantage of providing freedom for the franchisee is that you can use it as a motivational tool to give a sense of belongingness
Whether it is a large franchise or a small one it is impossible to say which one is more appropriate for you. The responsibility is therefore vested upon you to analyze your priorities and select accordingly. I hope you found this article informative enough in enlightening you the pros and cons of large and small franchise systems with respect to the support it provides to the franchisee.