SearchMarketMe | Blog

Franchise or Business Opportunity? What’s the Diff?

Posted on 05. May, 2011 by sbkarren in Online Marketing Industry News

When considering life as an entrepreneur, it is important to understand the differences between a franchise and a business opportunity. While franchises and business opportunities may seem similar, they are actually quite different and may appeal to completely different personalities.

So what is a franchise and who wants one?

A franchise is a “copy” of a specific business, and the license that you purchase from the franchisor authorizes you to sell or distribute goods or services in a particular geographic area, in a very specific way. When you own a franchise, you own the right to use the franchising company’s brand, processes, trademarks, and promotional materials.  You generally pay a hefty upfront fee to the franchising company as well as an ongoing franchise fee (also called a “royalty”) that is paid on gross receipts. Franchises appeal to people who want to own an “automatic” business. A franchise is simply an authorized copy of someone else’s business. Everything has already been thought-out, tested and proven for you. 

What is a business opportunity and who wants one?

A business opportunity is not as structured or as strictly defined as a franchise, but is a pre-packaged array of goods, services and/or training that allows the buyer to start a particular type of business. The upfront fees and royalties are generally much lower than a franchise. Business opportunities appeal to people who want to run their “own” business, not a cookie-cutter copy of someone else’s business. Business opportunities require thought, vision, and a little bit of daring.  Your business can become what you want it to be, and will ultimately reflect your desire, acumen and passion.

Let’s talk about pizza.

Let’s say you want to open a pizza shop and are trying to decide between a pizza franchise or a business opportunity.

If you buy a pizza franchise from “BigPizza” you get the benefit of knowing that there are already a number of BigPizza restaurants turning a profit for their owners. Your pizza shop will run in exactly the same way, in a very specific geographic territory.  Your supply chain is fixed – you will buy all your dough, cheese, tomato sauce, etc. from BigPizza’s corporate headquarters. Your advertising is fixed and out of your hands  – HQ determines the message and the media (but will require you to contribute to the costs of it).  All the important business decisions are made by HQ, right down to the kinds of pizza you can make. There are specific instructions for how many ounces of sauce and cheese and meats and vegetables to put on each pizza. In fact, the procedures (for everything) are simplified and documented to the point that you can hire workers with the lowest possible skill set and pay them the lowest possible wages.  A pizza franchise is not about the pizza. A pizza franchise is about the system. Do not deviate from the system!

Now, if you find a business opportunity that will teach how to launch and operate your own pizza restaurant (you decide to name it “PizzaLove”) you’ll learn how to operate your pizzeria based on industry best practices. You won’t be locked into a single supplier of your dough, sauces, and cheeses, etc., but you can let the competitive forces in the marketplace provide those ingredients, based on freshness or price, etc. You can access local marketing expertise to help you market your pizzeria to your local audience, providing a level of local customization a national chain simply can’t touch. You can decide if and when to offer promotions and accept coupons. You can set your own prices, and change your menu as you choose to accommodate trends and changing tastes in your community. You are free to find your desired balance between mass production of pizzas, and the art of pizza making.  A business opportunity is not about someone else’s system. A business opportunity is about your system.

SearchMarketMe is a Business Opportunity.

Our Agency Owners receive training and support in the technical aspects of online marketing as well as in how to make money performing online marketing services. They belong to and participate in an active network of Agency Owners that generates collaborative opportunities for sales and fulfillment, and which provides that ever-important support group of non-competing professionals. Each Agency Owner is free to operate their individual agencies in the way they choose. Some are full-time, some are part-time. Some focus on small local clients, some focus on a specific niche and as a result have lucrative contracts with Fortune 500 companies across the country. Some bill hourly and others use pay-for-performance compensation agreements that allow them to transcend the limits of hourly work and truly get paid what they are worth. As different as these approaches may seem, these Agency Owners all have one thing in common: They’re doing it their way via a business opportunity.

Learn More

Are you thinking about doing it your way? Are you ready to evaluate your potential fit in the SearchMarketMe Network? Then begin the Three-Step Evaluation Process:

• Reviewing the sample 2011 SMM Agency Owner Business Plan
• Participating in a 60-minute online technology demonstration
• Speaking with, and being recommended by, at least three Agency Owners from our Evaluation Board

Visit our website www.searchmarketme.com  and click on the “Start Your Agency” tab to get started. Or expedite your review by contacting us directly at 206-201-2105.