Two Ways To Become An Entrepreneur22 July, 2015 / Articles
Do you want to enjoy the financial freedom and the professional satisfaction that comes with the discovery and exploitation of new business opportunities? Do you want to be an entrepreneur?
There’re two business models for doing that.
First is the slow, and high-risk, business model. Do it on your own, perhaps getting a partner or two along the way to help with the marketing and financing of your venture.
Second is the fast and low-risk business model — join an existing business network. Like a franchise organization.
If you want to be an entrepreneur in the coffee shop business, for instance, you can either open your own coffee shop, or join a franchise chain – like Dunkin Donuts (USA), and Costa Cafe (UK).
If you want to be an entrepreneur in the restaurant business, you can start your own restaurant, or join one of the franchise chains – like McDonald’s, Chipotle, and Shake Shack, to mention but a few.
Each business model has advantages and disadvantages.
If you choose to go on your own, you don’t have to pay the upfront and subsequent fees, buy supplies from specified sources, or abide by stringent franchise rules. But you must develop your own know-how, brand, recruitment, training, and support mechanisms, which have their own costs and risks.
By contrast, if you choose to join an existing business network, you’ll have to pay all sorts of fees and follow all sorts of rules, but you will have several marketing and economic advantages.
First, you will be part of a well-recognized brand that will bring customers to your business from day one. Second, you’ll enjoy the economies of scale associated with a large organization, from sourcing to distribution, and advertising.
Third, you’ll experience economies of scope by running your own operations. Fourth, you’ll enjoy the support of the organization in certain matters that distinguish and separate one business from another, from employee recruitment and training to the maintaining high quality standards.
So which choice is better for you?
It depends on your personality. If you are a highly independent risk-loving individual, you may want to go with the first business model. By contrast if you are a conformist, risk-averse individual, you may want to go with the second business model.
In either case, you must carefully weigh the advantages and disadvantages of each model, and stick with the choice you made.