Individuals who wish to achieve relatively risk-free control over their working lives might consider franchising as a way to become their own boss without going it alone. It entails paying a fee to a franchisor in exchange for the ability to operate under their brand and proven business model, as well as access to a set of services such as training and support. In exchange, you will operate the franchise according to the franchisor’s tried and true business model.
But, while it may appear to make perfect sense at first, it might be difficult to understand how you can be quids in if you have to pay tens of thousands of pounds upfront, as well as annual fees. The franchising industry illustrates this by comparing the speed at which a franchisee makes money to that of an independent start-up. Essentially, because you make money faster as a franchisee, the upfront charges and continuing fees should be able to realize the potential for long-term returns not only faster but also more efficiently.
Reduced risk is one of the benefits of franchising; data suggest that franchises are far less likely than independent start-ups to fail. A reputable franchisor will have accounted for all potential problems and will have either investigated or can assist you in determining whether there is a need for its products or services in your area.
You’ll get all the systems and support you need to run your business as part of a franchise package, including training, bookkeeping, and development. Any national or regional advertising efforts, as well as on-tap promotional materials for local marketing initiatives, can benefit your company.
Franchising is not without its drawbacks. While you may have more freedom over your working life than you would as an employee, you are not free to do whatever you want. This may make you feel more like a manager than a boss, which isn’t for everyone, especially if you’re a self-starter.
The legal aspects
When evaluating your franchise agreement – a legally binding contract between franchisor and franchisee – it goes without saying that retaining the services of a franchising-experienced solicitor is essential.
Is it better to join an established brand or start from scratch?
Both established and new franchises have advantages and disadvantages, and picking which type to work with will be one of your most critical decisions. A successful franchise such as the barre studio franchise in Australia, with a well-known brand, is quite appealing. The brand is more likely to be recognized and trusted, and it also has a proven business plan. It may, however, be located in a saturated market, making it more difficult to earn a profit and resulting in higher rates.