4 Questions to Ask Yourself IF You are Ready to be a Franchisee

Franchising is an exciting form of business ownership, but as with any endeavor, there are always pros and cons. We recommend 4  questions to ask yourself:

1. Your investment: How much money do you have available to invest? How much can you afford to lose?

2. Your abilities: Does the franchise require special technical training or education? What skill set can you bring to the business?

3. Your goals: Do you intend to run the business yourself or hire a manager? How many hours are you able and willing to work a week?

4. Your potential franchise: Is there a demand for the franchise’s services or products in your area? What’s the level of competition on a local, regional and national level?

Franchising is an exciting form of business ownership, but as with any endeavor, there are always pros and cons.

GreatBusinessSchools.org recently published an infographic entitled Foray into Franchising which provides an incredibly helpful overview of franchising. Some of the key points are listed below, and you can read the full article online at read.

The article defines a franchise as a business endeavor which “lets a person or group of people – the franchisee – market a service or product using the trademark or trade name of an already established business, or the franchisor,” and divides franchising into two main types: product distribution and business format. Some key percentages are also shared, such as 55%, the “percentage of all franchise units in the U.S. owned by multi-unit franchise operators” and 4.5%, the “estimated percentage of the entire U.S. gross domestic product represented by franchises in 2014,” which they estimated to be about $493 billion.

The article also estimates that the franchise fee is typically around $20,000-$25,000, though it does “vary greatly depending on the type of industry or even the franchisor itself.” A list of the Top 10 Most Expensive Franchise to Open and the Top 10 Least Expenses Franchises to Open is also provided, along with an overview of the most profitable franchise opportunities.

We can help you figure out if franchising is right for you and, if so, which concept best meets your needs and qualifications.

 

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Posted in Franchise Basics, Franchise News.