When you decide to start your own business, you can start out with a brand new company or invest in a franchise opportunity. Franchise opportunities essentially come from large corporations and companies that let you buy into their programs. Some offer training programs that teach you how to run your business and sell those products, and others offer help with advertising and even hiring new workers. Before you sign up for a franchise that lets you sell all natural ice cream, run your own fitness center or clean homes, think about a few key things.
How Much Money Will the Franchise Cost?
The first thing to think about is how much the franchise will cost. You need to look at both the cost of the franchise itself and your overhead and operating costs. The franchise agreement states how much you owe the parent company and whether you need to make any additional payments. Some charge you an annual licensing fee, while others charge a fee based on the amount of sales you make. You also need to consider how much it will take to get that business off the ground.
What Support Does the Franchisee Offer?
Most franchisers sign up for these programs because they like the idea of having support from the parent company. Not all parent companies offer as much support as others though. Some will simple give you training guides and materials that you can read through on your own. Those companies will then expect you to run the business on your own and find success on your own as well. Others offer training in the company’s headquarters and will send representatives to your own shop or office to go over your needs.
What is the Competition Like?
Make sure you think about the competition in your area too. Subway was once the fastest growing restaurant franchise in the country, but its growth slowed down after multiple shops opened in most cities. If you open a sandwich shop on a street that has other similar shops and restaurants, you’ll have a hard time attracting customers. You should pick a franchise that meets a need in your community and one that doesn’t have a lot of competition in the immediate area. Before taking a chance on a franchise, consider your overall competition, the level of support available and the total cost.
