You’ve been toiling away at a 9-to-5 job for several years, answering to a boss who offers little to no promise of a promotion let alone professional growth.
These limitations make striking out on your own more appealing with each passing day. You’re confident you can do it for several reasons — you’ve saved up enough seed money to start, you’ve got contacts in the insurance industry to help, and you’ve got the hustle and grit to get a new venture off the ground.
The question now is how do you want to start? Should you launch a new insurance agency as a startup or invest in a franchise with a reputable, established company, like Freeway Insurance?
Let’s take a look at both options to help you determine which one might work best for you.
The Pros and Cons of Opening a New Insurance Agency
Striking it out on your own can be liberating, but it also requires a lot of clarity, capital, and decisive action. Here’s a look at some of the pros and cons of opening a new insurance agency.
Pro: Creativity and Innovation
Opening a new insurance agency as a startup gives you the creative license you’ve been dreaming about. You can name the agency whatever you like, decide what products you’ll offer, determine who your target market will be, and develop a marketing and advertising campaign that’s unique to your agency’s brand.
Launching your insurance agency gives you the chance to start on a clean slate with nowhere to go but up as you build the foundation of your new venture.
Con: Building a Customer Base Is Going To Take Time
While coming up with creative slogans and innovative marketing campaigns is an advantage of launching a new insurance agency, developing a customer base is going to take time.
Why?
Because you’re likely to be going up against a slew of rival agencies — local, regional, and national — that already have an established presence in your community. They have established a loyal customer base, and a reach that’s broader than yours.
Therefore, you don’t want to go into this new venture expecting overnight sensation. Success takes time.
Pro: Freedom, Flexibility, and Growth Opportunities
When you open a startup insurance agency, you’ll have all the freedom and flexibility you need to call the shots and make business decisions that shape your venture. You can choose the insurance products you’ll offer, determine what services your staff will promote, and seek out the growth opportunities that you feel will help your agency grow.
Con: Higher Risks and Higher Costs
Striking it out on your own means you’ll be shouldering all the risks and costs involved in launching your new insurance agency.
The office location you pick might prove to be a dud, barely drawing any foot traffic despite the hefty amount of rent you pay for space. A competing insurer — say, a franchise with brand name recognition — might also move into the neighborhood and successfully lure your customers, despite all the money you’ve invested in advertising and marketing.
The Advantages and Disadvantages of Launching a Brand-Name Insurance Franchise
Unlike a startup, which may only cost a small capital investment to launch, a brand-name insurance franchise calls for an initial investment and additional fees that can cost thousands of dollars. Despite the costs, a franchise brings opportunities that a startup lacks.
Now that we’ve discussed the pros and cons of opening a new insurance agency, let’s look at the pros and cons of launching a brand-name insurance franchise.
Pro: A Higher Success Rate
Because all insurance franchises operate under a proven business model, a franchisee’s main responsibility is making sure daily branch office operations run smoothly. They also receive ongoing training on insurance trends, the different products and services the company is offering customers, marketing initiatives, and other aspects of business management.
At Freeway Insurance, our franchisees benefit from our successful business model — one that’s based on more than 30 years of experience helping drivers, boaters, and property owners get the insurance they need. The ongoing support we offer our franchisees shapes their success.
Pro: A Broader Reach
When you launch a franchise with an established insurance company, like Freeway, you’ll be relying on years of brand-name recognition to draw new customers in — and with Freeway, that’s one of the best strategies you can bank on.
Because we’ve been around for more than three decades, we’ve developed a loyal customer base that consists of drivers and property owners who trust our products and services. We have a broader reach than a startup and as a franchisee, your branch office will extend these same products and services to a vast number of customers in your local community.
Con: Limits to Freedom and Flexibility
For some people, the biggest drawback of franchising is the limitation of the freedom and flexibility it brings. While a franchising agreement does limit your freedom in certain ways, for example- the products you offer, the services you provide, and the look of your branch office, you are still free to manage your business as you see best.
How To Decide Which Option Is Best For You
If you’re still not sure whether opening a new agency or launching an insurance franchise might be the best decision for you, here are three questions that might help you gain some perspective.
- How do you feel about risk? If your threshold’s high, then a startup might work well for you. If you prefer to keep risk low, a franchise might be a better option.
- Do you feel comfortable designing your daily business operation framework or would you prefer following an established business model? If you want to design and run your business as you see fit, you might be better off launching a startup. If you’re more comfortable following an established business model, opening a franchise might be best.
- Do you want to call all the shots or would you be willing to let corporate officers guide your progress? If you’re done listening to a boss and want to run your business with little to no outside insight, stick with a startup. If you’re open to receiving guidance from a corporate office on how to run your operation, go for a franchise.
Consider Joining the #1 Team in the Industry
A Freeway Insurance franchise puts you in the driver’s seat of your professional future, helping you build a customer-focused business that rewards hard work and dedication. To learn more about our franchising opportunities, contact us at (877) 822-3024 or contact@freewayfranchise.com.
