Franchises
For those of you that want to own your own business but don’t have the know how or the confidence to start from scratch and go it alone, a franchise might be the way to go.
Pros/Cons
Pros
- Ready made business model
- Support and hand holding by Franchisor
- Vendor discounts
- Marketing/Advertising tools already created
- Customer base possibly already exists
- Company name recognition
- Success/Failure rate of previous/current owners known
- Funding more easily accessible
- Protected territory rights
Cons
- Restricted by existing business model
- Personal creativity discouraged
- Restricted in use of vendors
- Possibly restricted territory
- High cost to buy better known franchises
- Royalties must be paid to Franchisor
If after looking through the pros and cons you decide you like the idea of going with a franchise you should research the many different types of franchises available. The costs vary from $1000 to well over $1 million.
Once you find some companies you are interested in and want to get more detailed information you can request their UFOC (Uniform Franchise Offering Circular). This is a document that franchisors must provide to prospective franchisees that includes numerous specific disclosures. In addition to disclosures, also included in the UFOC, are franchisee and franchisor requirements. What each of you are expected to provide is clearly spelled out.
You will find much more detailed information on franchises in the One Stop Business Start Up Kit including the following:
- Brokers
- UFOC (detailed explanation)
- Earnings Claims (yes, the Franchisor CAN disclose)
- Site Visits
- New or established?
- The Franchise Registry
- How to qualify for an SBA Loan
- Start up costs
- Grants
- Angel Investors
- Franchisor Financing
- Franchise Agreement
- Waiting Period (required by law)
- Site Selection
- Your Responsibilities (what the Franchisor does NOT do)
- Marketing/Advertising
- Support
- Training (exactly what you should look for, expect and questions to ask)
- Lease Negotiation
- Business Structure
The One Stop Business Start Up Kit contains over 170 pages of detailed information written by a business owner with firsthand, applicable knowledge. Order now and be well on your way to owning your own start up business or franchise!
