What’s the Difference: a Franchise vs. a Regular Job

How is franchise ownership different from holding a regular job? There are advantages and disadvantages to each. As you evaluate your options, keep in mind these ways that franchise ownership and jobs differ: 

Franchise vs. a Regular Job:  Income

Of course, both options should provide you with a source of income.  When you work for someone else, your income is typically clearly defined. That is, you know how often you will be paid and have an idea of what that amount will be. There may be variables (commissions or bonuses based on sales, for example), but you’ll usually be able to estimate those amounts in advance. A job provides quite a bit of certainty in relation to income. 

With a franchise, especially in the short term, your income is far less certain. During the startup period, business owners frequently work for some period of time without any fixed income. Though the long-term income potential may be quite a bit higher for a franchise vs. a regular job, you’ll need adequate reserves to live on during the initial building phase.  

Franchise vs. a Regular Job: Wealth

Owning a business is the classic path to creating wealth. That’s one reason that drives people to seek out franchise ownership. When you build a franchise business, you are creating an asset that grows in value and can eventually be sold. This wealth payoff is in addition to the income generated by operating the business. So, although owning a franchise involves taking a risk in the beginning, the reward is that the wealth your work generates accrues to you rather than to someone else. Few jobs entail an ownership interest in the business, so when you work for someone else, you build wealth for someone else.  

Franchise vs. a Regular Job: Control

A typical job provides you with little control over your work. Your employer tells you what they want you to do and how they want you to do it. But when you own a franchise, you are the employer, completely in charge of what you do at work. This fundamental difference is very appealing to some people but uncomfortable or even scary to others. As you evaluate which path to take, carefully consider which situation best suits your personality.

Whether you’re better suited to franchise ownership or a regular job depends on your priorities and life goals. The basic trade-off is fairly simple. While a job provides more income certainty, owning a franchise has more potential for wealth creation and allows for greater control. It’s worth the time and effort to do a self-assessment and determine the work situation that best suits you.