What is a primary drawback of starting a new business without a franchise or buying an existing one?

Starting a new business without the support of a franchise or the foundation of an existing business presents several challenges, one of which is the greater chance of failure. This is largely due to the inherent risks associated with entrepreneurship, especially for first-time founders.

When launching a new venture from scratch, entrepreneurs must navigate market research, product development, branding, customer acquisition, and operational logistics independently. This process demands significant knowledge and experience, and many new business owners may not possess all the necessary skills or insights. Without the proven business model or operational support provided by a franchise or the established customer base of an existing company, new entrepreneurs face a steeper learning curve and higher uncertainty about market reception.

These factors contribute to a greater likelihood of failure, as many new businesses struggle to find their footing in competitive and often unpredictable markets. The lack of established processes and resources that franchises or existing businesses provide makes the road ahead more challenging and increases the risk of business collapse.

In contrast, limited market reach, higher startup costs, and strict regulations can certainly impact a new business, but the fundamental challenge of increasing the chances of failure primarily stems from the risks associated with building a business from the ground up.