franchiseStarting your own business can be one scary endeavour, but when it works out, you’ll feel on cloud nine. But starting from scratch can be an overwhelming concept for someone who wants to manage their own business. It can take time, involve lots of learning curves, and will require you to invest a lot of money into it with often little return. If this sounds like something you would be interested in, then by all means – go for it! But for those of us who are a little less patient, and who want a few guidelines to follow to get the business of your dreams, there is another alternative: buy a franchise. By purchasing a franchise of an already established company, you get the business you desire, without the hassle of making a name for yourself in the industry. Someone else has done the hardest part – building the business from the ground up. Now, all you have to do is step in and take the reigns in your own franchise. But of course it’s not as easy as simply walking into a store and barking some orders. But don’t worry – we’re your finance friends, and we’ve got some tips to familiarise you with the franchise process.

So you want to open a franchise?

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As the old saying goes, you have to spend money to make money. Whether it’s starting your own business or building a successful franchise, you will be expected to invest your finances in the start up of the business. But these costs are no where near what would be expected if you were to literally start a brand new business that doesn’t yet exist. The cost of entry varies greatly, by both the segment you choose and the franchise brand you select within that segment. You’ll need to assess where you’d like to invest your franchise – fast food, beauty, retail – you get the idea. While costs range from less than $10 000 to upwards of $5 million, the majority of franchise businesses have entry costs of around $50 000, up to $200 000. Now it’s your turn to budget what franchises you can afford to engage with.

Before you even sign a franchise agreement, there will be initial costs such as an attorney to review your contract and an accountant to crunch some numbers for you and your budget. And before you can open a store, depending on the type of business, there will be costs for building the shop, inventory, equipment,¬†insurance, employee training, business licenses, rent and signage. Then there is the franchise fee – the one time entry price to use the franchisor’s brand, operating system, and management support, training and marketing. Franchise fees tend to sit around the $20-30 000 range, though the more upmarket your franchise, the more this cost will be. Once open, there will be ongoing royalties to pay, which typically hover between 4 and 8 percent mark.

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For a franchise to be successful, you need to love what you’re doing. The first question the Ella Bache Franchise website asks, is “Do you love skin?” And it’s a good question, because if you don’t, you’ll need to look elsewhere. There are a number of processes a company will take you through in order to determine your suitability to running a successful franchise. There will be interviews, deposits, financial assessments, and legal contracts before you can officially seal the deal. The company will then supply you with ongoing training and support to ensure you open your franchise with confidence, and manage the business to the best of your ability. If it were in fact skin and beauty that you wanted to base your franchise around, you would search for a beauty salon franchise for sale in Australia. To start new beauty salons, you would be trained in specific treatments and beauty knowledge that comes with the beauty territory, and given an efficient set of skills, tools and support you need to run a successful salon business.

The cost of owning a franchise essentially comes down to your own personal passions. If you have enough motivation and drive to run a franchise in an area you love, then the other costs will fall into place. The trick with opening a franchise is loving it enough that you see it as a challenging project rather than a tiresome job. While there are a broad range of costs involved that will take the bank balance down a notch, if running your own business is your dream, then a franchise is a great way to go.

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