Ways of owning a business. Challenges of starting a new business Requires more time and effort than...
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![Page 1: Ways of owning a business. Challenges of starting a new business Requires more time and effort than an established business Start-up costs are often high.](https://reader036.fdocuments.in/reader036/viewer/2022082613/5697bfb71a28abf838c9e9e9/html5/thumbnails/1.jpg)
Ways of owning a business
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Challenges of starting a new business
• Requires more time and effort than an established business
• Start-up costs are often high• You have to convince lenders that your
business will work• It is risky.
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The rewards of a new business
• You don’t inherit a previous owner’s reputation.
• You can build your business your own way.• You get personal satisfaction.
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Existing Business
• You can take over leases with lower rents.• You get equipment and furniture.• You benefit from a business with a good
reputation.
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Drawbacks
• Poor location• Competition • Market outlook may have changed• Building or equipment might need expensive
repairs• The business might have a poor reputation.
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Franchise
• Pay to another company’s products• You pay a fee to buy into the company• Pay a percentage of your profits• While you are in charge you have to follow the
company’s guidelines.
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Benefits
• Recognized product name• Established management system• Business reputation and customer goodwill• Training and support services• Advertising• financing
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Drawbacks
• Sometimes less profit• You have to pay a portion of profits to parent
company• Could be less satisfaction
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Homework
• Find the franchise fees for • McDonald’s• Smoothie King• Wendy’s • One choice bonus if you find a franchise that is
not food