How much does franchising reduce the risk of going into business on your own?

The level of reduction in risk will vary with how experienced the franchisor is, how well-proven the business format is and the level of training and support provided for franchisees. For a properly prepared franchise, however, the risks of failure are very low compared to going into business on one’s own.  Imagine an experienced person decides to open a sandwich shop. How do they know what makes a good location, what designs and layouts to use, what the menu should be, where to get the ingredients from, how many staff to employ, what to pay them and what to charge customers? All these questions, and more, will be answered by the franchisor from his experience and from the combined experiences of all his other franchisees.  Something like 50 per cent of independently-started businesses are no longer trading after five years. The figure for franchised outlets is around two per cent a year, so say 10 per cent after five years. However you look at it, that makes becoming a franchisee, as opposed to starting your own business, five times less risky.