12 Reasons Why You Should Purchase a Franchise

Franchising is one of three business strategies a company may use in capturing market share and to enhance its position with its competitors, in some cases franchising can be used to monopolise their sector. The others are company owned units or a combination of company owned and franchised units.

Franchising is a business strategy for recruiting and retaining customers. It is a marketing system for creating an image in the minds of current and future customers about how the company's products and services can help them. Franchising is a method for distributing products and services that satisfy customer needs. When purchasing a Franchise, you are in essence investing your savings and assets into a system to help utilise the brands name, the operating system and the ongoing support you should receive. You and every other person involved within the franchise network will be permitted to use the brand name and operating system as part of your Franchise Agreement.

If you do choose to become a franchisee, then you’ll be bound to a joint commitment where all franchisees are responsible for recruiting and retaining new customers. Legally you are bound by this and must achieve new sales with your franchise through the allocated marketing and operating systems of your chosen franchisor.

So why Should I Buy a Franchise?

1) Proven Franchise Model – When investing in a franchise you’re not just starting from scratch, all of the hard work has been done for you. The Franchisor has figured out what works and what doesn’t work to ensure you have a great chance of succeeding. The ideal franchisor would’ve already had a detailed franchise operations manual in place for you to follow. This will cover all areas from suppliers to recommendations for who to use for marketing. If you went alone instead of purchasing a franchise, then you’d have to go through all the heartache of figuring out what works best for your business and this can be extremely costly.

2) Support Services Provided – Franchisors will offer continual support services to ensure you’re ‘never alone’ once you’ve finished your initial franchise training. In some cases, this involves regular meetings (monthly or quarterly) and they’re always only a phone call away. If you’re involved in a sales franchise, then they may have a call centre at head office that will handle all of the inbound calls on your behalf too.

3) Extensive Franchise Training – Every franchise will provide training before you can set-up, you investing your hard earned cash isn’t the only risk involved. The Franchisor is taking a risk on you too, it’s their baby you’re going to be using and they need to ensure you’re fully trained/qualified to run the franchise to their standard. The last thing the franchisor wants is for you to fail 10 months down the line with his brand image being tarnished by the way you’ve operated.

4) Return On Investment – It’s no surprise that many retired employees are looking to use their pension to invest in a franchise. Even low investment franchises offer extremely attractive return on investments and when seeking to buy a franchise you should always speak to current fully operational franchisees to gauge their success. Most start-ups incur two years of making losses, with a franchise you should be making money within the first year.

5) The Brand – Consumers are also more willing to spend money on a brand, because effective brands influence customers to view their products as premium. If you buy into a meaningful branded franchise, research shows that individuals will spend 46% on your products or service, and this is before you’ve done anything with your franchise!

6) Recession Proof Markets – It’s key to focus your franchise research on franchises that produce good results during bad market conditions. Although it’s fair to say that no business is entirely recession proof, there are some markets that seem to thrive. For example, people will always require haircuts and businesses will always require assistance with tax returns/PAYE. Demand for certain products are always available, no matter the economy.

7) Be Your Own Boss – Franchising offers a chance to build a new future, one that allows flexibility of being your own boss. Why work your socks off for somebody else and earn a fraction of the sale? Why work your socks off for somebody else and not be treated with the flexibility of taking additional time off to spend with your family? Franchising can be flexible and financially very rewarding.

8) Easier to obtain funding – It’s becoming easier and easier to obtain funding to purchase a franchise. All of the major banks now have Franchise divisions set up, and it’s down to the franchisor help you provide a detailed business plan on the proposed franchise to submit to them. There also other groups such as Franchise Finance and Transmit that also assist with franchise funding. Some franchisors do offer the option to purchase the franchise at a lower initial investment figure but to pay back a fee monthly.

9) Increased success rate – Franchising within the UK continues to prosper with 97% of ALL franchisees running in profitability. Franchising actually contributes over £15 Billion to the UK economy, that’s how important and successful franchising is within the UK. Even more impressive is the fact that 91% of franchisees within the UK are ‘mainly’ or ‘definitely’ satisfied with the franchise they’ve purchased (data obtained from bfa/Natwest Franchise Survey)

10) National Contracts already in place – A lot of sales franchises will have already negotiated huge national and regional contracts for the group. For example, a cleaning franchise may have a national contract in place for a major well known hotel, so if you purchase that franchise and that hotel is in your territory then you’re already walking into a sale!

11) Support groups to help YOU – Joining a franchise which is a member of a support group such as the BFA, TFA or AFA means the franchisor is bound by a code of ethics created to protect the interests of franchisees. While it is not a guarantee of business success, it does ensure that the franchisor has been independently measured using established membership

12) No previous experience needed - No previous experience in a particular business is necessary for a franchisee to operate it. All deficiencies of know-how are made good, again, by training imparted by the franchisor. Indeed, one of the proudest boasts of franchisors is that they have the ability to turn a butcher, baker or candlestick maker into a fryer of chicken, dry cleaner or quick print shop operator. Any lack of knowledge on how to run a business is not a problem as a franchisor will provide the necessary training to the franchisee.

Buying a franchise should be the next step for somebody that truly isn’t happy with their current working lifestyle and want that flexibility and ability to achieve more for themselves, instead of placing money in the back pocket of their unappreciative boss.

Check out our latest Franchise Opportunities HERE