Franchising Business Commercial Franchise Lawyers – We have all heard of the term, and most of us know people involved in it. After all, it now contributes more than 10 billion to the UK economy, across numerous business sectors. But what is it really all about, and how are some businesses so successful at it, whilst for others it brings disaster?
The concept is fairly simple. In a franchise, an established business (the franchisor) grants someone (the franchisee) the right to trade under the franchisors trade mark or trade name.
Most franchising is actually business format franchising. This means that the franchisor develops a business concept, including a trade name and operating methods, and they train the franchisee in how to run their business using this concept. The franchisee operates his/her own business under the franchisors name and under some fairly tight controls and guidance. These are set out in a franchise agreement, and usually an operations manual as well.
At heart, a franchise agreement is essentially a trade mark licence, with a number of operational instructions and controls placed on the franchisee.
In many cases, the franchisee is given an exclusive territory in which to operate during the term of the franchise agreement.
For franchisors, franchising can therefore be an exceptionally quick route to business growth, with low overheads and low risk. We will look at this in more detail later on in this article. For franchisees, franchising can provide an attractive opportunity to own and operate their own business, but one which has a proven business concept and which provides training and support. Franchising can in some cases also provide a very rare opportunity for genuine work/life balance.
Sadly however, as with everything in life, it is not always that simple. Although survival rates for franchisee businesses are much higher than for other business start-ups, franchisees all too often fail. Some lose substantial amounts of money, often through no fault of their own. Below are some of the perils to avoid:
Peril No. 1 – Not doing enough homework before handing over your cash
Most franchisors can talk a good talk. It is their job to convince you that their franchise offering will bring you wealth and success. However, whilst many franchisors are scrupulously honest and professional in their dealings with prospective franchisees, some of them are unfortunately not.
Remember when you take on a franchise this is a business to business agreement. There is no consumer law to protect you, so your legal remedies may be very limited. It is your responsibility to check out what you are being told, and never to take promises and forecasts on face value.
It pays to remember the age-old saying: If it sounds too good to be true, it probably is!
Membership of the British Franchise Association – requiring the signing of a charter for ethical franchising – is a good indicator of an opportunity worthy of consideration, although there is no substitute for properly checking out and researching a franchise.
Peril No. 2 Taking on a franchise which does not play to your personal strengths
You need to think long and hard about whether taking on a franchise will suit your personality and skills. You may imagine, for example, during a frustrating day at the office, that nothing would be lovelier than leaving the rat-race and running your own cafe. But beware of the grass is greener over the fence philosophy. No matter what franchise you take on, it is likely to involve hard work, and this will never be satisfying unless it is something that you are passionate about.
Month: July 2019
Unique At Home Franchises
Have you ever considered running a business from your home, but maybe wanted something a little more solid with a long standing reputation behind it? There are many franchises that offer just that- your own business, from your home, with very little overhead and quite alot of freedom to be the success you know that you can be. Here, we will explore just a handful of the frontrunners in the at home franchise world.
Mars Venus Coaching
Yes, you know the name. Made popular by the books by John Gray, this franchise is a hot one to follow. In this franchise you are given a wide range of products that are not available to the general public to give your at home relationship coaching business a boost. Relationship coaching is a fast growing industry and one that is a vital and needed service, so this is definitely worth your time to check out.
Beautiful Vending
The personal care and salon industry is booming now more than ever. You can cash in on this trend and run your own vending service, selling a proven product that is known world wide. This unique concept allows women to style there hair in restrooms anywhere they are, so it is certainly a winning idea for those who prefer a more laid back way of doing things.
Filtafry
A frontrunner in the environmentally friendly franchises, Filtafry also became a leader in at home franchising with its low start up, high level of support and the best part is, you can keep all of your equipment in a very small space. Filtafry has such acclaim and long term reputation for excellence and is certainly a stable choice for anyone looking to open a business dealing with the hospitality industry and more.
The Back Rubber
Another unique idea that is growing in popularity is the Back Rubber. Massage chairs are a relaxing and quick break for anyone out on the go- certainly many men can attest to finding relief from a long day at the mall in one of these. Best of all, the Back Rubber offers not only support, but a locater service to help you succeed in running your very own massage chair station.
Housewarmers
With wonderful support and an easy to follow, proven business system, Housewarmers is not only a great franchise to buy, but a fun, flexible way to enjoy your at home career. This valuable service welcomes newcomers to your neck of the woods while at the same time, enabling them to find the goods and services they might need, connecting them with advertisers of your choosing.
There are a wealth of at home franchises that can certainly not only suit your lifestyle, but your budget as well. Very low start ups, unique ideas and great support make these companies a great idea for anyone who would like to run their own business, with a level of support that you just can’t find in other at home independent options. Check around and for whatever interests you, you are sure to find the at home franchising options that suits your needs, your budget and your ideas for how you’d like to build your own career.
Why Business Franchising Is A More Popular Investment Choice For Banks
Critical to starting a business is having the appropriate finance in place, and money alone is the number one reason most as much as 90% – of business ventures fail during the early start-up period. While management failure does also play a part, it is money that makes any business worthwhile and gets it off the ground. At the same time, business franchising is a popular way of starting a business and becoming your own boss, and for a variety of reasons business franchising start-ups tend to be viewed more favourably by banks and investors. There are numerous key business reasons for this bias.
Firstly and most importantly of all, business franchising is a proven and tested business model. By virtue of being a business franchise, any opportunity of this nature requiring money has already been proven to work in another geographical area. Someone else has already demonstrated that the business model has the ability to work and generate revenues, and as such it has been franchised out to other business people. As such, banks tend to consider the business model less of a risk, allowing them to base their decisions on the faith they have in the individual in front of them rather than the specific intricacies of the business model.
Secondly business franchising is given more priority in funding because there is support available from the parties that have already made a success of the business. Because help is on hand and usually some form of training is provided, theres no trial and error with a franchise. The franchisees know exactly what to do and how to do when it comes to making a success of the business, which translates into a lower risk proposition and makes them instantly more creditworthy. The only consideration running through a bank managers mind is whether or not the business will be able to repay the loan they are offering, and with a business franchising opportunity and the support inherent in that, they find their answer more readily.
Another key reason business franchising received funding preference from banks and other lending institutions is that there is already a degree of goodwill associated with the franchise name. This means that the business franchising opportunity will benefit from the branding and marketing previously invested in by the franchisor, which will give the new business a lift when it opens. Simply because a business has a recognisable identity and has previous goodwill, it is less of a risk and less likely to struggle to find those all important initial paying customers and lenient suppliers.
Business franchising as a business model makes sense, and everybody on all sides of the table are kept happy. For the banks and money lenders, business franchising provides a much lower risk way of investing in businesses, and a much more guaranteed way of earning money on the finance offered. As such, banks are much more willing to invest in franchising opportunities than in other business ventures, making it far easier to raise the necessary capital to start up and survive the initial few years.
Grabbing Business Franchise Opportunities In The Food Sector
Food in India is a fascinating mix that has evolved with changing lifestyles; the taste is myriad and out-of-this world and the way it is cooked is just mesmerizing. Spices add to the tanginess, the flavor, and the uniqueness in every dish that are bound to let mouths water at the very thought or sight. There is a staggering variation of food in India from region to region and the taste, of course.
Sweet food in India is chiefly made from sugar. There are many homes in India that still follow the traditional methods of preparing sweet food at home on special occasions including during festive junctures like Diwali, etc. Urban families prefer buying sweets in bulk for use at home as well as for gifts to neighbors, friends, and relatives.
Be it breakfast or between meals or just like that, vegetarian snacks never fail to delight your taste buds. Vegetarian snacks of India are known for the crispness and appealing tastes. If you have a busy schedule, you dont need to worry because choicest vegetarian snacks are available at the nearest food outlet to fuel you up. Savory vegetarian snacks liked by most people include samosas, vegetable pakora, paneer pakora, aloo tikki, bread rolls, chole bhature, daal kachori, bada pav, etc.
There are counted few restaurants that are known all over the country as well as worldwide for the taste and variety of sweet food, vegetarian snacks, South Indian food, and other snacks items like namkeens. These restaurants like Bikanervala offers business franchise opportunities to interested people. Business franchise and franchising opportunities are increasing internationally. If you have a long cherished dream to turn out to be a business owner; buy a food business franchise and you will never regret it.
Routing Biz Success Via Franchising
Accessibility of diverse business opportunities is creating a lot of confusion among aspiring entrepreneurs to zero down on a single business opportunity. To add to this confusion is the increasing trend among brands whether service or product to opt for franchise route for expansion. No doubt taking up a franchise business opportunity is always preferred over opting for an independent business, still it is difficult to zero down whether to get associated with service franchise brand or retail franchising one. Franchising provides all the know-how and expertise of running a business successfully, which an independent business can never provide. From selecting the right location to recruiting the staff and from designing the logo to creating a brand image, everything will be done by the business owner which in not a case with franchising. No doubt franchising is successful business formula yet selecting the right business opportunity needs lot of care.
Franchising is divided into two major categories: Business or service franchising and the second one is Retail franchising. The brands that are providing services to the consumers are called service franchises and the brands that are providing product or are selling products or merchandise from a retail outlet and is expanding via franchising is called retail franchising.
The major sectors or industries that may fall under service franchising include food and beverages, education, health and beauty, play schools and activity centres, pre-school education, IT education and training, business services, consumer services, car care services and school education.
Retail franchising mainly include industries like apparel, footwear, jewellery, pharmacies, FMCG, consumer durables, furniture, electronic goods, home appliances and so on.
Some factors need to be considered before taking up a final call on the franchise business opportunity by the aspiring entrepreneur. Right business selection would definitely decrease the risk of failure and would elevate the levels of success. The article presents some measures; if taken care of at the initial phase of selection of business opportunity, the percentage of success is higher at least, if not guaranteed.
Search and research: Talk to various business owners for experience and knowledge in the areas that interests you. Understand the need of the market and ask questions.
Analyse yourself: It is very important to find out if you are a business person or not. Write down on a paper describing why you want to take up the business opportunity at all. Know your marketing and sales qualities and understand your family obligations.
Check your finances: Take a note on the kind of investment you can make. After having analysed the budget search for the business opportunities that suits you.
Check business model: Search for various business models available in the market. Make your mind if you would like to opt for franchising or independent business.
Select right industry: Having short-listed the industry for which you want to take up a business talk to experts and gather as much information as possible. Evaluate the opportunity in terms of investment required in terms of money and market value of the brand.
Take financial assistance: Talk to your accountant about income and profit projections made by the franchisors and talk to a solicitor about the franchise agreement.
Zero down on a wise decision: Analyse everything before taking up a final call. As you will be putting in your hard earned money in the business so do not just rush into the decision. Be 200 per cent sure, before making an investment.
Conclusion:
The availability of diverse business opportunities in franchising as well retail franchising on one hand offers plenty of prospects where as on the other creates lot of confusion, leading to lot of confusion. A self analysis followed by adequate search and research is the best foot forward for right business opportunity.