A new start with a Management Franchise
Joel Caws - Technical Director, Select Your Franchise
A management franchise is generally a business that requires the taking on of staff to carry out the daily tasks of running the business, while the manager oversees the running of the business. Combined with the proven business model of a franchise, this can be a great business option for those individuals that have money to invest but don’t necessarily want to get involved with manual tasks.
Of course in the initial stages, some management franchise opportunities may well necessitate some direct involvement in the hands-on labour, but the ultimate goal is to grow the business to a point that will support the employment of workers to take over the labour, and therefore boost the total work capacity of the business. Other management franchises depend on initial investment to take on employees from the outset which will be paid back in time as the business becomes profitable.
A management franchise business can be either business-to-business or business-to-consumer depending on the products or services offered.
An example of a business suited to run as a management franchise is a cleaning service business where you can set up the business managing a team of cleaners that perform the cleaning tasks. Domiciliary care is another good example, where carers can be recruited to perform the necessary jobs. Most retail business franchises are also typically management opportunities where they require a team of employees to serve customers with whatever products or services you are supplying.
Whatever type of management franchise you consider, make sure you do your research properly. It’s important to know who you are dealing with and also get as much ‘franchise buying’ advice as you can. Some good sources of advice are franchise legal experts, franchise consultants or the British Franchise Association.
If you have decided a management franchise could be the right business option for you, then do some initial research into the options available and draw up a shortlist. Take some time to visit the franchisors offices to get a feel for their operation and ask any questions that might be on your mind. Another important part of checking out the claims of your chosen franchise, is to speak to a few of their existing franchisees. Any good franchisor will be happy to provide you with the contact details for a number of their franchisees so that you can chat to them about how the franchise business works in practice and find out about their experience in dealing with the franchisor.
Once you are happy to commit yourself to the franchise business, make sure you are committed and ready to work hard at putting the proven business concept into motion. This will give you the best chance of success.
To see a list of management franchise opportunities, visit our management franchises section.
3 Common Mistakes to avoid when buying a Franchise
Joel Caws - Technical Director, Select Your Franchise
Investing in a franchise can be an ideal way to start up a business. Of course there are no guarantees with any business but with a little bit of research, it’s possible to lessen the risk of failure as much as possible and maximise the possibility of your new franchise business being a winner. Here are a number of common mistakes and some suggestions on ways to avoid them:
Mistake 1: Not researching the franchise properly
Problem: Would you buy an expensive product just because the company tells you its the best thing ever? Some might consider it, but the majority of us would think twice before spending a large sum of money on something, especially if you had never heard of the company before. We might read reviews from other customers for example or read more in depth information about the company and its products. When it comes to buying a franchise, bear in mind that you’ll likely be giving a substantial sum of money to the franchisor as a start-up ‘franchise fee’.
Suggestion: Find out as much as you can about the franchisor and its Directors. How long has the company been trading, what other businesses might the Directors be involved in. Does anything you find out give you cause for alarm?
Beneficial sources of company information can be the Companies House website, talking to the franchise sections of the main high street banks and also specialist franchise business consultants who might be capable to offer you some industry insight on any franchise business you happen to be considering.
In addition, check out if they are a member of the British Franchise Association. Association Member Franchisors are required to pass certain membership criteria which may give you some additional confidence in the franchise opportunity.
Mistake 2: Not talking to people who are already franchisees!
Problem: When purchasing costly services or products we often seek the advice of trusted friends and relatives, especially when we have no experience of purchasing that product or service before. Getting this kind of advice helps to minimise the possibility of making a mistake and losing money, especially if someone you trust has been in the same position and can point out pitfalls from their own experience to help you avoid them.
Suggestion: You might not have friends who have purchased the same franchise business you are considering. However, a franchisor will be able to provide you names and contact details of existing franchisees who were once all in the same position you are right now. Make sure you contact several of them to find out their experience in buying the franchise, how the business is working for them now they are trading and their opinion on the support the franchisor provides them with. This will be invaluable third party insight into the franchise business you are considering.
Mistake 3: Presuming that a Franchise business carries a warranty!
Problem: There can be a feeling that since a business is known as a ‘franchise’ it’s in some way a sure fire winner. The bottom line is that you will ultimately be the person responsible for success or failure of the business. A franchise is simply a business method that has been proven to generate a profit when it is ‘worked’ correctly.
Suggestion: Once you have decided to buy a franchise business, commit yourself to be dedicated, hard working and a believer in the franchise system you have chosen. Ensure you have the total backup and support of your loved ones as it will require a lot of time to develop a successful business.
Tags: Buying a franchise, franchise, franchise information, franchise opportunities, franchise research, joel caws
The Benefits of a Franchise Business
Joel Caws - Technical Director, Select Your Franchise
Back in 2002, when I initially began working within the franchise industry I was surprised on the huge variety of franchise companies out there, from the well-recognised, fast food chain restaurants that grace pretty much every shopping centre, to a multitude of home based franchise opportunities that you could call upon to have your boiler serviced, your garden tended to, your carpets cleaned, or the stone chips in your car paintwork repaired.
I think my biggest surprise was that I had, in fact, used many of these services myself with out even being conscious of their franchise heritage. Just about any service you can think can, and probably already has, been franchised. Browsing through any of the on-line franchise directories will quickly provide you with an idea of the quantity of franchise options accessible to pretty much anybody with some capital to invest, a willingness to learn, a dedication to stick to the system and put in some hard graft.
So what are the advantages to a franchised business over traditional self-employment?
A proven business system
The heart of a franchise enterprise its is proven business formula. A franchise is often born out of a traditional business which, after proving itself profitable, prompts the business owner to look for further ways to expand their already profitable business. The essence of the franchise concept is, quite simply, the replication of a proven business formula.
Having a business model which is already proven offers the key advantage over self-employment in that the franchisor has already done the hard work of trying and tested the business model. They have then documented the processes and procedures that makes it successful in order that it can then be adopted by another, giving them the power to duplicate their success.
Customer impression and the advantage of branding
Of course you don’t have to think hard to recognise the power of some of the big fast food franchise restuarants. This strategy of constantly enforcing a brand message means you go into any franchise outlet knowing what to expect… the same service, the same quality, the same product. This can provide a significant advantage over establishing your own personal unknown branded business. There are of course many smaller, lesser known franchise brands which even though maybe not as widely publicised, the customer impression that it is a part of a much bigger network can in itself deliver security and confidence to the shopper that can provide you with that all important edge over competition.
Funding
When providing funding for any business start up, the bank will always assess the most important thing – How likely is the business to succeed, and therefore, is the banks funding secure and likely to be repaid in a timely fashion.
Many banks look favourably on franchise start ups because they have a proven track record. Even in these more difficult economic times, the story from the banks is still one of being open for lending. The recession though, has put even more emphasis on the bank scrutinising any business plans to ensure that the chance of success is as high as possible; another benefit of choosing a franchise business since the franchisor can provide evidence of success to help backup the franchise business plans you go along with to the bank.
Training and support
Part of a franchise package is training and support to help make sure your business has the best chance of success. This doesn’t relinquish you of any responsibility, it is your own business after all, but it does mean that you are as equipped as possible to run a successful business or that there’s someone to talk to for advice and help when times are tough.
These are just some of the key advantages in selecting a franchise business over going it alone. However, franchising is ultimately an investment like any other business. Starting up a franchise business requires initial care and attention to make informed choices along the way and then working hard to ensure best possible chance of success.
