Franchises and Turnkey Business Packages – A Comparison

If you’ve decided this is the time to start your own business, you might be considering a franchise. If so, you will also want to research and compare a lesser-known business model - a turnkey business package. Though not a franchise, there is a remarkable comparison.

With both of these business models, someone has struggled through the long learning curve, the trial and error - and packaged all that knowledge.

They both usually have a contract, which indicates their professionalism and intent to provide all that is promised to you, the buyer. It also ensures to the seller that you will perform your business as required, which protects his brand. (I would recommend staying away from any business that doesn’t offer a contract.)

Franchises and turnkey business packages should provide a thorough marketing package, which includes a website, newsletter content and distribution and additional marketing materials. These key pieces are essential, as you’ll be able to have a presence on the web and promote your business quickly and professionally.

A very detailed and informative operations manual is essential, which includes processes and procedures, marketing and sales assistance a thorough background and insight of the industry. Documents should also be provided that serve as templates to set up your business procedures quickly.

Training is another key component of high-quality franchises and turnkey business packages. Hands-on training not only tells you how to conduct the business, but shows you as well. Sure, you could figure it out for yourself, but that can be time-consuming. The purpose of the training is to bring you the benefits and opportunities for questions during this important interaction. This shortens the learning curve drastically.
The final “must have” with either a franchise or a turnkey business package is continued support. This is an ever-changing world. New ideas, new methods, new opportunities can appear and it is the corporate office’s responsibility to stay up with the industry and mentor you.

These are the key features where a quality turnkey business package and a franchise are comparable. There are two main areas where they differ.

The first is the structure of the operation. Franchises operate identically. Most require the same clothing/uniforms, policies, name, hours of operation, etc. If they are a store-front, the corporate office usually must approve the location. Territories are stringent and exclusive.

Turnkeys have a similarity, based on the training and operations manual, but offer the flexibility of being an independently owned business. Most do not have assigned territories, but some have guidelines for marketing and sales.

The cost is the other major defining item. Franchises normally charge a percentage of monthly revenue, while most turnkey packages do not charge fees based on sales. Some have a membership fee, usually to help cover the cost of the marketing package and continued mentoring/consulting.

Franchises are the most costly to purchase. In addition to the purchase price, additional funds are frequently required in available capital.

Turnkey business packages are more affordable, with a much lower investment required. Some provide financing options to assist you.

There are a wide variety of quality turnkey packages and franchises from which to choose. The determining factor is how much structure – or freedom – you want. If you like a lot of structure, a franchise is most likely your best business model. If you prefer freedom to make some of your own decisions, but want help getting started, and also receive continued support, a turnkey business package is most likely for you.

No matter what you choose, compare before buying! And remember, no matter how good a franchise or turnkey business package is, the success of your business is up to you. That responsibility rests entirely on your shoulders. Your determination, hard work and perseverance create your outcome.