Should You Franchise or Go Independent?

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There are many benefits of choosing to join a franchise: access to their name, a service territory, materials like staff training and management manuals, and marketing materials.  If you choose a franchise with good brand recognition, these can be great perks.  The initial steps of starting a home healthcare business-obtaining a license, marketing, training management and employees- may go more smoothly for franchisees than for independent agencies.

Franchises are great to start a home health business, but once you grow out of your service territory, other franchisees become competition and limit you from growing into other regions.  In addition, the royalties owed to the franchise may become bothersome once you no longer need the benefits they offer, like training and brand awareness.

As an independent, once you establish your agency and build your brand, you can determine your own service territory.  It is very possible to find success as an independent agency; the 50 largest home healthcare companies in the U.S. account for only around 25% of the revenue-small companies compete by successfully serving local markets.  While larger franchises have an edge on marketing, with the right marketing and connections an independent agency can compete with a franchise.

When considering a franchise, it is important to consider the level of brand recognition.  Ultimately, you will be weighing brand recognition, training and support, and connections and resources against the upfront license fee and franchise fees paid over time.  If you do choose to become independent, your success will depend on creating a brand for yourself and finding your own channels to provide marketing. This may prove challenging and require strong entrepreneurial skills, confidence, and hard work.

meddirect capitalShould You Franchise or Go Independent?

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