Franchise Advice Please

[jjandellis]

Posted a few months ago about voluntary redundancy. Turns out I fall in the bracket for age/time served and am now just waiting to find out whether or not by trade/corps will be offering the VR...

In the meantime I've done my calcs and one option is to go for a franchise.

Would really be a step into the unknown for me. Seems to be a fair bit of info out there on websites, but I'd rather hear stories (good and bad) from people that have experienced franchising (and obviously any advice would be hugely appreciated).

Has anyone on here done similar or currently running a franchise?

[Graham C]

There's a franchise show on soon I think, pretty sure I heard an advert on the radio for one yesterday, worth looking into.

[Dingdell]

I have looked a lot at franchising and a lot fail. Franchising can be easy because it may give you a turnkey operation, business in a box type thing and if you any unsure that you have the relevant expereince to run a business off your own bat then it may be an option but they can be a bit limiting as you may be tied in to a contract that doesn't serve its purpose a year down the line.

Always work out what you need to achieve each month to meet the costs of the franchise and make a living, some will tie you into purchasing their products reguarly for the term of the franchise even if you do not need that much stuff as you are doing a lot less work than you expected.

Get a good look at their accounts - available at companies house - and see where their income is coming from. For example there is one driving school franchise that makes the majority of their money providing training for their franchisees and not a lot from the actual franchise operation as the instructors are not making enough money selling driving lessons. So the franchisees spend a lot buying the franchise and not a lot of income is generated from their individual businesses.

If the business idea is a good one it may be that you may be able to do something similar without paying out for the franchise - look at what you get for your money - and if the name does not bring in the business then start it yourself. When I was a broker I spoke to lots of companies who wanted to promote their business through franchising and it was their way of trying to expand the business without any risk to themselves - so if it went tits up they were still ok - so beware.  Get the BFA magazine and they will give you a lot of info which may be useful.