While there are some catering franchises available in the market, franchising is not as common in the catering business as it is in other industries. Below are some of the advantages and disadvantages of become a franchisor as opposed to starting up your own independent company.

Advantages

1) Benefit from the years of experience and the systems that your franchisor has developed. You should receive thorough training and ongoing support from the head office.

2) The head office should handle advertising and marketing for you and you can thus feel confident that they have methods that should work well.

3) Name Recognition. Clients will already be familiar with your franchise business name and brand. If it is a good brand then customers should have trust in you, even before dealing with you for the first time. You can develop your own brand but it takes time. A solid brand makes it easier to win customers and may allow you to charge a little more due to customers perceiving that you offer better quality than other caterers in the market.

Disadvantages

1) Startup costs are generally higher with a franchise. You may have more expensive set up costs due to the requirements and high standards of the franchisor and you will have to start paying fees for the right to be a franchisee.

2) While it is great to get support from the franchisor this help is often not cheap and ongoing franchise fees can really eat into your profits.

3) As a franchisee you may be locked into expensive obligations with the franchisor, such as having to buy catering business equipment and other supplies off them or through their associates.

4) Lack of freedom to make your own decisions. A franchise can be an easy option for a new entrepreneur in the early days of their business life but in the long-term many businessmen find that a franchise can restrict their ability to grow their businesses, profit and implement their own systems.

5) As a franchisee you will have to open your records to inspection by the head office.

6) Franchises don’t always look out for the best interests of their individual branches. Allowing too many branches to open in one area is one example of franchisors stabbing their franchisees in the back.

7) Lack of an exit strategy. Many entrepreneurs find that their franchise agreement is very difficult to get out of once they have signed it. Make sure that you read your agreement carefully, consult with a lawyer and make sure that you have exit options available that won’t cost you an arm and a leg.

For those that already have experience in the hospitality industry and are willing to take the time to learn business management and marketing then taking the independent road is probably the best option for starting up a catering firm. Rather than relying on a franchise for a reputation, individual owners can also develop strong brands. Spending startup capital on developing your own brand is surely a better use for it than spending it on leasing a brand belonging to someone else.