Frequently Asked Questions
Established individuals from the franchise industry share their knowledge and experience to answer some of the most common franchising questions.
Question: How safe is my investment with a franchise?
Your investment in a franchise is considerably safer than an investment in a stand-alone business start-up. Independent evidence gathered by the bfa and NatWest Bank shows that 90 per cent of UK franchises are profitable and many high street banks maintain that over 90 per cent are successful after two years, compared to only 40 per cent of other self-employed business start-ups.
This is because good franchises offer a proven business model, a strong brand and support from experienced business professionals. It goes without saying that your investment is safer still if the franchise has been in operation for a number of years, has an established network of successful franchise owners and has demonstrated resilience to economic recession.
It is also worth noting that a great franchise can provide not only a safer investment, but also a considerably better return than many other investment opportunities.
At ChipsAway, some franchise owners have enjoyed an excellent living for many years, then achieved a good return on their initial investment when their franchise has been sold on.
However, there are no guarantees. Building any business requires hard work and commitment in order to succeed.
Lloyd Evans Chief Executive ChipsAway
Question: How important is the strength of a franchise brand to the franchise owners?
With a Snack-in-the-Box franchise it is very important. We are supported by Mars and other major confectionery brands. Our branding on vans, stationery, clothing etc. certainly ‘opens doors’ when franchise owners are looking for new business.
Sean Cleveland Sales Manager Snack-in-the-Box
Question: How do franchisors assess the suitability of prospective franchise owners?
After initial consideration of a completed application form and CV we will meet prospective franchise owners face-to-face at an initial meeting. Our purpose here is to get to know the prospective franchise owner and how well their skills and experience fit with our requirements.
We also want the franchise owners to assess us to determine whether they wish to enter into a long term partnership. It both parties wish to proceed at the end of the first meeting, we would undertake a personality profile questionnaire.
The prospective franchise owner would then be provided with a complete list of all our franchise owners and encouraged to make contact with as many as they want. We do not cherry pick from our existing franchise owners for this purpose. We find that this open and honest approach helps us to develop trust with our potential franchise owner quickly.
After a period of a couple of weeks, a further meeting at our head office would then be held. In this session we spend time explaining our business model in more detail and drill down into the financial details.
Mike Parker Managing Director Minster Services Group
Question: How soon can I expect to make money back froma franchise?Franchise owners should be taking a salary within months and earning back the cost of the franchise within two years – obviously everyone is different and each franchise owner works according to his own agenda.
Geoff Whittle Managing Director Prokill