Becoming a business owner can be a pretty daunting task, but what if you had the opportunity to build and develop a business from scratch, using a proven business model and an existing brand? Cherie Williams considers whether owning a franchise business could be the route to entrepreneurship that we’ve all been looking for.
If the above sounds appealing, you could be just the type of person to start a franchise business. Think McDonald’s, Subway, Puccino’s Coffee, Pitman Training – all of these are successful and well-established businesses. However, I do wonder how many of us are aware, that these are actual franchise businesses.
The trend for opening franchise businesses is on the rise and I discovered this for myself a few weeks ago, when I spent the day at the British & International Franchise Exhibition, which took place between 31 Jan – 1 Feb 2020 at Olympia London.
“Franchising now contributes £17.2 billion to the UK economy”
I was astonished at the multitude of business opportunities available, because, like many of you I’m sure, I automatically only think of food businesses when I think of a franchise! However, the opportunities at the exhibition were wide ranging and included care, property, coaching, business to business, farming and many more. There were also lots of free seminars available throughout the day, providing lots of extra information and advice. I attended six seminars in total hosted by ActionCOACH, Ethical Property Partners, British Franchise Association, McDonalds, Hitachi Finance and Platinum Property Partners.
Despite the seminars focusing on specific businesses, I still managed to pull out some general great pointers for anyone considering the possibility of becoming a franchise business owner. So here goes…
Essential franchising tips:
Franchises are not an easy business option; a considerable amount of time and commitment will be required especially in the first couple of years.
Ensure your finances are in order
You will need to invest some of your own money, around 30%. You’ll also need to have strong credit to be able to secure funding/loans.
Do your due diligence
If you’re interested in a particular franchise, contact the franchise owner, find out about the challenges in their journey, when they started to make a profit, and the support they have received. And most importantly, get legal advice from a firm that specialises in franchising.
Do your research
Just because you will be following an existing business model, it’s still important that you do your own research. Ask questions, make decisions based on facts, spend time in other franchise businesses. Research is key!
It’s also important to be aware of the following:
You will need to follow an existing model
This means that you will need to abide by the franchise business model including branding, design, uniforms etc. It’s a key part of the franchise model.
You will be locked into a franchise agreement
The agreement can be tough and long. A minimum of five years up to 25 years and the terms are usually non-negotiable.
I learnt at the exhibition that “Franchising now contributes £17.2 billion to the UK economy”, that’s a whole lot of business. After attending the exhibition, I do believe that franchising is a viable option. However, there’s definitely a lot to consider.
For more information and details on other exhibitions taking place this year across the country visit www.franchiseinfo.co.uk