 |
|
 |
|
Navigation |
|
Buying a Franchise |
|
Article Snippets and RSS |
|
Top
Automotive Franchise |
|
Buying a Franchise
Buying a franchise is not for everyone. This guide will help you
evaluate whether buying a franchise is right for you. It will
help you understand your obligations as a franchise owner. Many
people dream of owning and running their own business but are
often let down by the reality of doing so. By purchasing a
franchise, you often can sell goods and services that have
instant name recognition and can obtain training and ongoing
support to help you succeed. But be cautious. Like any
investment, purchasing a franchise is not a guarantee of
success. A franchise typically enables you, the investor or
"franchisee," to operate a business. By paying a franchise fee,
which may cost several thousand pounds, you are given a format
or system developed by the company ("franchisor"), the right to
use the franchisor's name for a limited time, and assistance.
While buying a franchise may reduce your investment risk by
enabling you to associate with an established company, it can be
costly. You also may be required to relinquish significant
control over your business, while taking on contractual
obligations with the franchisor. Outlined below are some of the
main points you need to consider before buying a franchise: -
Franchise fee: Your initial franchise fee, which may be
non-refundable, may cost several thousand to several hundred
thousand pounds. - Royalty payments: You may have to pay the
franchisor royalties based on a percentage of your weekly or
monthly gross income. You often must pay royalties even if your
outlet has not earned significant income during that time. In
addition, royalties usually are paid for the right to use the
franchisor's name. - Advertising fees: You may have to pay into
an advertising fund. Some portion of the advertising fees may go
for national advertising or to attract new franchise owners, but
not necessarily to target your particular outlet. - Controls: To
ensure uniformity, franchisors typically control how franchisees
conduct business. These controls may significantly restrict your
ability to exercise your own business judgment. - Terminations
and Renewal: You can lose the right to your franchise if you
breach the franchise contract. In addition, the franchise
contract is for a limited time; there is no guarantee that you
will be able to renew it. A franchisor can end your franchise
agreement if, for example, you fail to pay royalties or abide by
performance standards and sales restrictions. If your franchise
is terminated, you may lose your investment. Franchise
agreements typically run for 15 to 20 years. After that time,
the franchisor may decline to renew your contract. Before
investing in a particular franchise system, carefully consider
how much money you have to invest, your abilities, and your
goals.
|
|
A franchise can present a great opportunity for business.
Franchise Article RSS Feeds
|
|
This
is a third party franchise article - we make no claims or guarantees
regarding the accuracy of the information presented |
|