Franchising is well understood to be a simple way to go into business for the first time.
Instead of starting from scratch you buy into a proven system and business model (or you should do, otherwise it’s not a true franchise!) which makes it a much lower risk option.
In fact a 2011 study compiled by NatWest and the British Franchise Association (BFA) showed that 90% of over 39,000 individual franchisees in the UK recorded a profit in 2011; however beware that "a profit" may not equate to a decent liveable income.
Franchising is no guarantee of success and the same principles of good management that apply to mainstream businesses, such as informed decision-making, hard work, cashflow control and serving your customers well - still apply.
The main advantage of buying a franchise is that your business should be based on a proven successful idea and you should be able to check how successful other franchises are before committing yourself. Be aware that most franchise networks have their “star performers” which are run by people who could be successful at just about anything, so be sure to investigate the average franchisee’s performance and not just the superstars (who are the ones you'll probably meet on the stand at the franchise show!).
Other advantages include use of a (hopefully) recognised brand, established deals and relationships with suppliers, and the absolutely crucial advice, help and support of the franchisor who’s been there, done that and got the t-shirt.
Disadvantages tend to be the cost of buying the franchise in the first place, on-going franchise fees which are often a proportion of income. You may be restricted to trading within a territory, and will usually have to run your business in accordance with the franchisor’s guidelines whether you agree with them or not. Also if you want to exit the business it will inevitably be worth less as a franchise than if you’d started it from scratch, often far less. Plus their may be hefty exit fees, and you will be restricted in who you can sell to.
Sound financial advice and support from Day 1 will help you be successful with your new franchise.
They have provided our services to more than 70 different franchise brands, and can provide help and support to franchise businesses both technical and commercial advice, such as:
Reviewing your existing position to ascertain if any immediate improvements can be made
A full bookkeeping and management accounts package tailored to suit your needs and budget.
Benchmarking your results against the rest of the franchise network
Payroll & VAT
Credit control and cashflow management
Year End Accounts and Taxation
Registered office and company secretarial services
TFMC offer a local and personal service to our franchise clients from their network of offices, including the one local to Aldershot and Farnborough run by experienced accountant Kass Verjee.
Don’t get bogged down with financial administration - leave it to the experts, and focus on your business.
For a no obligation chat to discuss how Kass could help you build your local franchise call 01276 409036 or click through below for more information.