Franchise help

[Scott]

My company has decided to loose 40% of the staff in the next few months.

I guess my name will be near the top of the list (many reasons) so i'll be looking for a new job.

 

I dont want to be working for someone else so i'm looking into using my pay-off to perhaps invest in a franchise, (no ideas yet, still looking) has anyone here any first hand experience of starting a franchise or anything that might help, i've found a few websites but there might be more.

 

Any help would be very wellcome,

 

Scott.

[Elton]

Scott,

 

I don't have any experience here, but wish you well. My father-in-law is facing a similar dilemma and is now starting to think that a franchise is the way to go, so I will watch this thread with interest.

 

Good luck,

 

Elton

[davidP]

Scott, I'm starting one as we speak (hence the new signature below). British Franchise Association is a good place to start ( www.british-franchise.org ) - they do a basic pack for £30 giving information, advice and a video, along with a list of all their members (lots aren't members of course). The Daily Mail has a couple of pages each week on Monday with lots of adverts and details of exhibitions, and there are a couple of monthly magazines - Business Franchise (BFA's magazine) and The Franchise Magazine. These should be available from WH Smith.

 

We were lucky. I just happened to spot the only advert that our Franchisors placed in the Daily Mail, and as we were actually customers of the original company before they started franchising we knew it was a good business proposition in our area. We are therefore in on the ground floor and are opening one of the first two franchises, hopefully in about a month or so. Because I've been a contractor for a few years operating with a limited company the business side of things doesn't phase me. For people who are new to it though it could be a little daunting. You really need to do plenty of research beforehand to investigate your franchise and the competition and how it will go down in your area. You also need to do a lot of work on costing, particularly start-up costs, because you could have to survive several months with no income and minimal profits in the first year (our projeted profit is around 5 times bigger in year 2 compared to year 1 largely due to up-front costs). Fortunately I'm not giving up work - it's going to be largely the wife's business, and so I can subsidise the franchise for the first year.

 

Once you've done your figures and projected cash flow for the first couple of years, look at them in a worst-case scenario and assume that's what will happen and budget accordingly. That way you're really going into it with your eyes open.

 

What you will find however is that the Franchisors should take you through most of it, and fulfilling their requirements will almost certainly give you most of the infomation you need. It's in their interests to ensure that you're going to succeed and unless you're going to a new operation like us they'll have been through it many times before with people just like you. We're fortunate in that our Franchisors have spent a lot of time and money ensuring that they've done it right before starting to franchise, and they've made it pretty straight forward for us to follow.

 

There are plenty of books out there to help as well (my wife seems to have bought most of them). I'd suggest a quick trip down the library and a search through the business section.

 

One thing I would say is that you should take legal advice on the contract. It's not cheap to find a specialist but that's what you'll need. They won't tell you weather to sign or not, that's down to you, but what they will do however is explain in simple terms what all the clauses in the contract actually mean. This will give you a better idea of what you're actually letting yourself in for. Most of the contracts are almost entirely on the side of the Franchisor and in extreme circumstances more or less give them the right to take back their franchise lock stock & barrel without compensation. Obviously it's highly unlikely to happen, but it's a bit of an eye-opener when you first read it!

 

Anyway, I hope that helped a bit. Feel free to get in touch through here or privately if you wan't to talk about anything.

[chesters1]

be very carefull my brother got a carpet cleaning one all was well and he took on another chap ,unfortunatly the franchiser started others in the same area ,what was a well paid enterprise soon became a nightmare as more people were trying to find less work in the area he had to give up ,but now is a social worker which proves you can go from bad to worse

[davidP]

chesters1:

be very carefull my brother got a carpet cleaning one all was well and he took on another chap ,unfortunatly the franchiser started others in the same area ,what was a well paid enterprise soon became a nightmare as more people were trying to find less work in the area he had to give up ,but now is a social worker which proves you can go from bad to worse

*nod*

 

A good franchising company should ensure that you have a workable and financially viable patch. They obviously cannot guarantee that other companies won't set up similar operations in your area, but they should at least ensure that you aren't competing with someone from the same firm.

 

Part of our deal is an exclusive specified area determined by postcode by a specialist demographics company and a guarantee that the Franchisors will not launch further franchises inside that area. We therefore have around 100,000 ABC1 households to aim at. Basically the plan is that the franchises will work together to do advertising, publicity etc and that neighbouring franchises will help each other where required.

[chesters1]

in the real world i agree but what happens when they run out of a workable and financially viable patch do they stop or does the patch grow smaller ,times have changed (hopefully) he started in the melee and companies wern`t so caring for their franchisee`s only in recovering the cost of their outlay

[wirral sea fishing]

In former lives I have had many Jobs, mostly as a chef as that is my trade or rather WAS !! i wasted alot of time and effort in Chef School and only dream of what i would be now !, but as i went down the road of jobs, i fell into the job i have now and i have been there ever since, but during a period of lay off due to the tobacco industry not spending money i took up a franchaise with a milk company, now i was lucky in that all the people in the area wanted Milk delivered to the doorstep, now b4 you say NO as soon as read it, it is one of the most enjoyable jobs i have ever had ! and as it looks like i may soon bein the same position i will be looking down the same road again, most Daries will give you 13 weeks paid training and during this time you will get to see how "YOUR" round is paying and how the custombers pay, if they are bad debters and how big the debt on the round is, any bad debt will be written off before you take the round on, it is a great way to see how everything works, if you dont like it off you go... collecting was always the thing i liked as you get to know people and so on, the early mornings mean you are home at the latest for 10am giving you the rest of the day to follow other interests, i started an Alarm Company while on the Milk ( Told you i had done everything)

if nothing else it is worth looking into, also the franchaise fee is taken off you each week if you wish !

Good Luck

Chris

[Jim Roper]

There is a huge growth industry out there just waiting to con redundant employees out of the contents of their brown envelopes!

There are equally large numbers of employees who think that they could make a bomb in business if only they had some capital.

One of the few words of wisdom that I ever heard come out of an Irishman's mouth were "If you are going to make money, you will do it whether you have capital or not". Another was "If you're in debt, you're in danger".

Go to a bank and ask to borrow the money for the franchise first. If they won't have anything to do with it, have second thoughts.

If you can manage it, used your brown envelope contents to buy a house and take in a 'lodger' at £60.00 a week tax free, as you are allowed, to help with the mortgage payments. After a few years of regular mortgage repayments without any delays, buy another one.

Within a few years you won't be worrying about a pension plan!

You can have 'anything' you want if you are dedicated enough!

 

Jim Roper

 

http://www.searchlineuk.com/FishList.htm

[chesters1]

or do as a farmer friend did ,he used to slave year in year out selling hay etc ,in the end he converted all his outbuildings to stables ,rented them and grazing for a nice income ,has lots of attractive girlies about ,still sells THEM hay AND sells their horses dung