Franchises
Thinking about a new career which gives you the freedom of being your own boss, allied with a support network of people with good business acumen? Franchising could be exactly what you’re looking for!
Self-discipline, motivation and a strong ability to work on your own initiative are all admirable attributes developed during your time in the services. In civvy street, they could make all the difference if you choose to become your own boss. Self employment, however, is not without big financial risks; if you find the idea of starting a business from scratch daunting, why not consider taking on a franchise?
WHAT IS FRANCHISING?
Generally speaking, franchising involves running a business under the name of an established company. You pay an initial fee to use the brand name and or trademark of an established business, and run your own outlet in a particular area. It is often said that franchising is running your own business, but not on your own.
The technical definition of Franchising, provided by the British Franchise Association (BFA), is ‘the granting of a license by one person (the franchisor) to another (the franchisee), which entitles the franchisee to trade under the trade mark/trade name of the franchisor and to make use of an entire package, comprising all the elements necessary to establish a previously untrained person in the business and to run it with continual assistance’.
The finer details and terms and conditions of each contract between franchisee and franchisor will vary from one company to the next, but the general principles will be the same.
HOW DO I KNOW IF FRANCHISING IS RIGHT FOR ME?
It is a big investment of not only money, but also time and often hard graft, so it’s worth asking yourself: ‘Is this for me?’ Firstly, take into consideration your own personal qualities; a background in the armed forces will have taught you some very valuable skills and qualities, many of which are deemed essential in a successful franchisee. We’re talking about qualities such as self-discipline, determination, organisation, motivation, drive and self-belief (which is not to be confused with bull headedness!).
All said and done, as a franchisee, you must be realistic; it is often the case that franchisees risk their homes, savings and relationships by investing unrealistically in particular businesses. Being consumed by dreams of becoming successful business owners can make people do some pretty irresponsible things with their funding; the secret is to err on the side of caution and do your homework before you commit!
This will definitely involve looking at your own current financial commitments, as well as your financial expectations and your personal qualities. You should also look at the accounts and projections of the franchisor. Then, and only then, can you make realistic judgements about a franchise that will suit you.
You should be realistic about the kinds of business that will suit you – do you really want to be selling furniture, offering reprographic services, selling burgers, etc – and take the time to find out what’s involved in different business ventures. Ideally, the best people to ask are existing franchisees!
If you have the determination and self-discipline to put in the work, and are willing both to learn a lot and give it at least 110%, you’re one step closer to being a successful franchisee!
WHAT TYPE OF FRANCHISE?
When you’ve thought about your own skills and decided that you can do it, you have to go about choosing a suitable franchise.
Your first port of call should be to consult the British Franchise Association (BFA). As the only independent accreditation body and membership organisation for franchising within the UK, they are not only able to offer invaluable information and a wealth of expert advice, but can provide you with the contact details for hundreds of franchisors who have agreed to stringent codes of ethics.
BFA Members are accredited against a wide set of criteria, based on the European Code of Franchising Ethics, to ensure they are: ethical and operating with a comprehensive franchise agreement; viable and franchisable with a strong product or service proven by substantial successful franchisees; disclosed – members are obliged to disclose their financial records, financial projections and the identity of their franchisees.
Some franchisors will have a limit to the number of businesses they will sell in one area, so you may be disappointed if your first choice is not available and you are not willing to relocate; to avoid total disappointment, have a shortlist of at least six options in mind and research them all fully before approaching any of them.
Many people make the mistake of selecting the first franchise they hear about, or a franchisor that takes their money with little discussion; don’t make the same mistake and jump in both feet first. Take time to find out the facts. For some starting ideas, have a look at our list.
HOW MUCH DOES IT COST?
Franchises can cost as little as £5,000 for a small home-run business (or one which is based mainly from a vehicle, such as a mobile car valet service) up to as much as £250,000 for a well-known, established and clearly very lucrative business, such as one of the many large fast-food restaurants.
While you may wish to invest the lump sum received when you leave the forces, remember that you can always borrow from a bank or building society instead. Be wary, however, of borrowing more than you can pay back!
It’s definitely worth speaking to the BFA before you make your decisions; not only do they have lots of general information, they also have the contact details for all major franchisors.
There are also a variety of franchising exhibitions running across the UK throughout the year, which gives you the opportunity to meet other prospective franchisees, talk to successful franchisees and look at the various franchises that are on offer.
You can also contact franchisors directly to find out what they offer in terms of contracts, training and how much it would cost to get started. Alternatively, you can contact Business advisers, Accountants, Solicitors and Trade Associations who may be able to provide you with some basic information as a franchisee.
If all the things to look out for sound daunting, they should; most franchisees began by investing a lot of money as well as their lives into a franchise, yet franchising can be a lucrative business venture if you have the determination to make it work and are sensible enough to think it through thoroughly. Just think; being your own boss, making a profit and putting your name to a successful business could be closer than you think!
John Franklin is one person who has made a success of franchising. Having ventured into the recruitment industry by opening Select Appointments’ Liverpool office in 1998, he now owns two of Select’s most successful franchises and is looking to take on a third.
John wanted to invest in a company that was able and willing to offer support and advice when it was needed. “It was important to me that the company I bought into was based on integrity and a solid business model. Within Select, the franchise offices are pulled together and operate as part of the overall business plan and strategy. The franchises aren’t simply a spin off to the central company.”
The support structure offered by Select proved vital for John during the initial stages of his business start-up. “Not only was there someone at the end of the phone when I needed advice, the knowledge that I wasn’t alone in the venture was invaluable,” he says.
“The support from Select was always there, as well as training when I needed it and the ability to speak to other people who had been in the same boat. The most important factor was the constant reassurance from people who had seen it all before, that I wasn’t doing anything fundamentally wrong during the toughest times.”
“Essentially, Select proved to be a company that I could relate to and work with. A long-term relationship with the franchisor is vital, if a franchise venture is to success,” he continues. “If you are willing to put in the work and commitment and the franchisor offers the right level of support, the potential for great reward and job satisfaction is certainly there.”
Anyone interested in joining him as a Select franchisee should contact Debbie Smith at debbie.smith@select.co.uk or call on 07960 241684
After 25 years of life in the RAF, ex-Wing Commander Paul Voltzenlogel faced civvy street with a clear idea of what he wanted to do next; he was very keen to work for himself.
His first step was to visit a franchise exhibition to find out detailed information about franchising and how to go about it. While he was there, he looked at some of the franchises that were exhibiting, focusing on those which most closely matched his criteria. He wanted a business that would provide variety, a reasonable living for the family and a good return on the initial investment. He also wanted some flexibility in his working life which would enable him to spend more time with his children.
In all, Paul took a year to research franchising. He narrowed his choice down to three franchises before choosing Mail Boxes Etc.
“I expected that the business would start modestly and grow steadily but I’m delighted to say that our rate of growth has been much faster than predicted,” Paul commented. “All the services we offer are extremely popular and our reputation is growing all the time, bringing in more customers. In fact, things are going so well that I’m seriously considering taking on another centre.” It’s definitely worth speaking to the BFA before you make your decisions; not only do they have lots of general information, they also have the contact details for all major franchisors.
There are also a variety of franchising exhibitions running across the UK throughout the year, which gives you the opportunity to meet other prospective franchisees, talk to successful franchisees and look at the various franchises that are on offer.
You can also contact franchisors directly to find out what they offer in terms of contracts, training and how much it would cost to get started. Alternatively, you can contact Business advisers, Accountants, Solicitors and Trade Associations who may be able to provide you with some basic information as a franchisee.
If all the things to look out for sound daunting, they should; most franchisees began by investing a lot of money as well as their lives into a franchise, yet franchising can be a lucrative business venture if you have the determination to make it work and are sensible enough to think it through thoroughly. Just think; being your own boss, making a profit and putting your name to a successful business could be closer than you think!
FURTHER INFORMATION
British Franchise Association
Tel: 01491 578 080
www.british-franchise.org