How can a franchise help me achieve success?

Franchises are far less common in the developing world. In Ghana for example, most franchises are foreign owned, the most recent example of which is KFC. Franchising however can be an avenue through which you can become an entrepreneur (if you don’t want to start from scratch) or a way to expand your existing business by providing financing.

Franchises involve using another firm’s successful business model and acting as manager, the key difference being that you have an ownership stake.

As a way to become an entrepreneur
Once you’ve met the requirements of the company through which you’d like to own a franchise, you get to take advantage of an established business model. Despite being the owner of the franchise, you do not own the brand or the business model and as a result you have little control over changes made and are obligated to share profits with the parent company.

As a way to expand your business
Franchising can be a source of much needed capital to expand your business. Franchises operate through contracts with franchise owners. Therefore you need to be able to quantity aspects of your brand (for example, the product, the level of service, the atmosphere etc.) and define them within your contract. You’re also obligated to share profits with franchisees and you run the risk of the aspects of your business which are harder to define (for example a particular ambiance) being altered.

Are franchises a viable option for Ghanaian owned businesses? Feel free to share your thoughts.

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