Big Things Come in Small Packages – The Value of Micro-Franchise Brands

For entrepreneurs looking for small-scale business opportunities, micro-franchises might be the best route.

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What is a micro-franchise? Well, it's franchising, with all of the attributes of a traditional franchise business model, but the business opportunity is typically a smaller, more scalable operation. Perfect for first-time buyers and budding entrepreneurs alike, the concepts that fall under the micro-franchise category can be owned and operated as a mobile or home-based business. The value proposition of a micro-franchise is the ability to start a small operation, targeting a specific low-cost product or service (often a niche opportunity) in a high-traffic or volume territory. In a micro-franchise operation, owners begin with a targeted community level-effort that starts small but grows as the initial profits are reinvested in the business. As for concepts, micro-franchises can be found across a wide variety of industries, but some of the most common examples include residential and commercial cleaning, kiosk-related retail operations and senior care-related businesses.

For entrepreneurs, the benefits of owning a micro-franchise brand are evident from the start.

Related: From Poop Scooping to Dryer-Vent Cleaning: Why Hyper-Niche, 'Micro' Franchises Are Booming

A tight-knit brand relationship

Because micro-franchises follow a specific script on a smaller scale, initially there are several factors that mitigate the risk of the entrepreneurial venture. Thanks to their scalable nature, the relationship between franchisor and franchisee can be much more intimate — with frequent contact, guidance and check-ins. This sentiment is echoed by micro-brand franchisee Noel Trim who, along with her husband Jason, own a property maintenance franchise called Second Home Care in Kona, Hawaii. "I see our franchise as a partnership," Trim says. "I was able to learn so much from our franchise brand owner and felt he really wanted to see us succeed. I felt secure and safe making this leap with their help and leadership."

Related: 4 Essential Things to Know About Franchising

Taking on less risk

Micro-franchising's roots began in less-developed countries and the concept has aided in lifting many of its entrepreneurial owners out of poverty. The "one-off" nature of these franchise opportunities typically requires less investment but offer the same upside of selling a known entity in a specific territory. Because of the operation's scalability, and usually low price-point, franchisees don't have to maintain large inventories. Thanks to the franchisor's relationships with existing vendors and suppliers, it's not at all unusual to acquire goods at a low or discounted rate. Micro-franchisors also typically provide marketing, advertising and promotional initiatives for the franchise system — one less headache for new owners. Above all, there's always less risk when you have the ability to grow and expand at your own pace.

Dipping your toes in the entrepreneurial waters

Budding entrepreneurs and existing franchisee candidates can get "skin in the game" on a much smaller scale, without a big, upfront investment with micro-franchises — yet the operation still relies on all of the benefits that come with following a proven business model. The built-in systemization of micro-franchises can be an advantageous choice for first-time business owners who want to dip a toe in the entrepreneurial waters. Of course, it's always advisable to do your own research and seek the counsel of franchising professionals to assist in your efforts. A great place to begin is with the book, "Start Your Own Business." As the subtitle says, it's the only startup book you'll ever need.

Related: These People Signed Up to Be a Brand's First-Ever Franchisee. How Did That Go?

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