Pros and Cons of a Franchise for Small Businesses

There are many different ways to achieve small business ownership, and not everyone wants to own a business for the same reasons. If you are more attracted to being your own boss and being in control of your career, buying a franchise may be the solution you need.

What is a franchise?

Purchasing a franchise gives you an established brand, along with entire system to work use. Some of the most commonly recognizable franchises today are restaurants like McDonald’s, Subway, Olive Garden, and so on, but there are many other industries aside from food service that offer franchise options.

The question usually isn’t whether there is a franchise option out there to suit your interests, but rather, will franchise ownership provide the small business ownership experience you desire? Here are some pros and cons to help you decide.

Pros of franchise ownership for a small business:

The first big pro to buying a franchise is that you are buying a system that has already been proven to work and make money. The franchise will tell you how to market your products, set up your store, handle inventory, and pretty much everything else too. Follow their instructions and you have a high chance of success.

Another pro is the established brand and reputation that comes with a franchise. People will already know your name and be willing to come to you because they know what to expect from your business. No need to struggle building a name, because it’s already there.

Cons of a franchise for small business:

The biggest con is the expense. Buying a franchise is often a costly endeavor upfront, and then you will owe royalty payments every year on top of the startup costs. If you don’t have a lot of capital to invest right away, franchise ownership probably isn’t for you.

The other major con of a franchise is the lack of freedom. The franchise will tell you how to advertise and operate, and you have to follow it to the letter. If you want to run a business completely on your own terms, you don't want a franchise.

Keep up with all the best tips, information, and news that is crucial to small business owners today by visiting We are happy to answer questions and offer service and support for today’s small businesses.

Author: Charles Barr, Co-Founder & Director of LVRG Funding, a "boutique" small business funding company dedicated to helping America's small businesses thrive and grow. Charles is highly dedicated to the genesis of professional development, social networking and civic engagement, with a passion for cultivating creativity, entrepreneurship and a spirit of community. You can contact Charles via email at or call (855) 998-LVRG.