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Does anyone here run a franchise?

Discussion in 'Franchising' started by Emma, Jul 30, 2008.

  1.  
    JoebeeKenobi

    JoebeeKenobi Freshman

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    Hi there... although I'm not a franchisee.. I do work in the franchise industry as part owner of a online franchise directory for 7 years now... In general I've heard only good things about starting up in franchising as it is much more successful than just going solo. My advice is to do your research and check out the franchise company and yes, speak to their franchisees. On the whole if you look for one that is BFA (British Franchise Association) Accredited then you know they have at least been checked out by the BFA and that their offering is kosher at least. Of course no business opportunity comes without risk... but checking out their support structures and knowing you will get the backup and help you need is what will set them aside from others. My Co-partner Nick, wrote a helpful blog article recently on how to choose a franchise which you might find helpful: [URLnf="http://www.selectyourfranchise.com/franchise-blog/?p=812"]Recession is presenting new opportunities for franchise start-ups | Franchise Blog at Select Your Franchise[/URLnf]
    It includes a "10 things to discover before buying a franchise" section which might be of help.
     
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    mangostudio

    mangostudio Applicant

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    SphereMania Franchise

    Hi guys

    One of our clients (SphereMania) runs a franchise company across the UK with 11 locations, each of them a franchise. They're great guys and I'm sure they'll be willing to help or point you in the right direction and who best to speak too.

    They recently became members of the BFA too.

    Best of luck, Vinnie
     
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    Mark

    Mark Moderator Staff Member

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    UK Business Network

    UK Business Network Junior Lab Tech

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    We are currently looking at franchising each county, put some feelers out and had a fairly good result, looking at making it enough that they need to earn it back (create the drive in their sales) but enough that its very affordable and will not run at a loss (£499)

    It may seem daft but our thinking is that we would rather have people buy into it then sales staff, there is so little drive when backed by a basic salary, I started with comms only at 16 and they were the days I wish would return.

    Will keep you updated.
     
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    redsocks

    redsocks Applicant

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    filtafry

    Just a word of warning about filtafry. I was a franchisee for them for nearly three years and they took my franchise from me with no notice or compensation. In my opinion they are crooks.

    Does anyone else have any stories about them? if so check out filtafry.freeforums.org

    Cheers
     
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    Wana Bee

    Wana Bee Graduate

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    Never owned or worked for a franchise :D
     
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    JoebeeKenobi

    JoebeeKenobi Freshman

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    Its true theres some rogues out there. I'm an avid fan of franchising (been connecting with many different franchise businesses around 7 years now) but I think many can fall into the illusion that the "franchise" label alone gives the business opportunity credibility and can lull the uninformed into a false sense of security. Its an investment and like any investment some good background checking and due dilligence should be carried out to give yourself the confidence to stump up your hard cash.

    Theres nothing to stop anyone claiming their opportunity is a 'franchise' but by checking out the background of the company... chatting to their existing franchisees to see what their experiences are... and checking with the British Franchise Association to see if they are members or if there are any known issues with the franchise management team (historic failed businesses etc) can usually give you as much confidence as you can get.

    It still doesn't guarantee success but will give you a good fighting chance to make it work if you know you have stable backup and support from the franchisor in conjunction with a well documented and proven model.

    Joe
     
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    Ray Stewart

    Ray Stewart Lab Manager

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    I have two clients who run children related franchises but they have a hard job making more than a wage out of them. These are definitely bias towards the franchisor as they take far more out than the people working the franchises and their hands are completely tied about marketing - no doubt in case they cross into another territory - but means their growth possibilities are almost nil. The allowed marketing doesn't work at all either.

    I also looked at a courier franchise a few years ago for a client but managed to convince him before he sank £'000's in that he would struggle to make any money at all, let alone recoup the investment and make a living as well.

    Finally, I took on a client who was a mobile mechanic. He had spent several years fighting his old franchisor for his money back due to failed promises, non existant vehicle and equipment etc.. He lost around £9k and this is back in the last century. The franchisor went bust - that was the excuse.

    I expect there may be some reputable franchises out there but I would need to see some seriously impressive figures and several successful franchisees before I recommended a client put money into one.
     
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    Emma

    Emma Senior Lab Tech

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    Thanks for all the answers, everyone. :)
     
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    Mint Signs

    Mint Signs Applicant

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    My wife bought in to a franchise and also lost about £40k like MattPoll said, from my experience I would say if you want to buy in to a franchise only do it with a large company that is very well known across the UK, it's the smaller ones that are made to look more attractive than they are are you can get bitten, it's a rock and a hard place though as smaller franchise is cheaper so less to lose but more of a risk where the larger companies are very expensive but are "almost" guaranteed to work and at what level is up to the individual owner.

    I personally would never touch one again unless it was the same industry I was in so knew a hell of a lot about it, enough to know if worth while or not or at least to know if a franchise would actually make you more money than if you started on your own.

    having done mine on my own I feel much better about myself and am much prouder, yes I know more money is also better but that's were you need to be able to tell the difference. If you have the confidence and belief to make it on your own then you will do as well if not better than with a franchise ......



    ...... and maybe turn your company in to a franchise yourself one day ;)

    cheers

    Warren
     
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    writecombination

    writecombination Freshman

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    I was recently enticed to visit the 'Grow your own business' exhibition on the grounds that it provided networking opportunities.

    When I got there I discovered that it was happening 'in association' with a franchise exhibition - and the 'grow your own business' section was four fairly useless stands. The whole event was really about promoting franchises. The only networking was talking to people wanting to sell a franchise.

    While I found the event interesting, I was also disappointed that the marketing for the event had been, in my opinion, somewhat underhand. Reading this thread only increases my feelings that taking on franchise is fraught with risk and the world of franchising is quite murky.

    I'm sure there are plenty of legitimate and successful franchisors and franchisees out there. But I'm guessing there are also those hoping to take large chunks of cash off the recently-redundant in return for vague promises of a future income stream.

    Andrew
     
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    SheffieldPDC

    SheffieldPDC Applicant

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    I have worked for printing.com for ten years and performed a MBO in 2005 to become the Territory Franchisee for South Yorkshire & South Humber.

    As well being an extremely successful franchisee myself, I also licence out to creative businesses in the area. I then provide ongoing support and mentoring to help them operate the business model and systems. So far I look after eight other businesses, all of whom are growing.

    In my experience, people entering into a franchise make the following mistakes:

    1) They think that having a franchise is 'sales on a plate'. Wrong. A franchisee will still have to work hard on the normal business development activities. The franchise provides a recognised brand, a business model, tried and tested processes, an approach to delivering the product/service and experience and support. But sales will not neccesarily come to you and it still stands that our most proactive and charismatic franchisees are our most successful. No different to the rest of the business world!

    2) Trying to 'reinvent the wheel'. As I've said above, when buying a franchised business you are accessing sometimes years and years of experience, trials and tribulations, testing and development. Certainly with printing.com, what we do works and it works at it's best when it is taken as a whole. Where things fall down is when the franchisee picks and chooses the elements they most like/agree with/are most comfortable with. A franchise is a 'business model' and should be utilise in this way to get the most from it. There is simply no point investing in that model if you have no intention of doing it in exactly the prescribed way!

    As you'll probably gather, I'm a dedicated, fully paid-up printing.com-er! I'm very passionate about my business and the franchise model and I think if a franchise is a good one, this is what you should get from it.

    Hope my insight helps others - I'd welcome any comments you might have :tup:
     
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    SheffieldPDC

    SheffieldPDC Applicant

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    Thanks Cleo, glad you found my comments useful!
     
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    Kay

    Kay Senior Lab Tech

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    I recently published an article by Philip Wylie, who is the author of two successful business books. It's a three parter and includes the advantages and disadvantages of franchising, as well as an evaluation checklist to go through if you're contemplating going into such a business.

    Buying a franchise: Part One | BritishExpat

    Hope you find it useful.
     
  15.  
    SimplyDocs

    SimplyDocs Freshman

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    Legal aspects of franchising

    Hi,

    You can find some information about legal aspect of franchising on our website.

    Franchising is another form of licensing agreement whereby, as the franchiser, you transfer to the franchisee a total business concept which he exploits within a given territory in return for royalties for the IPRs licensed. There is also commonly a supply arrangement whereby the franchisee is committed to buying his requirements from you.

    A franchising agreement would normally involve the supply to the franchisee of expertise, branding, corporate image and management support. In return you would hope to receive an initial sum, payment for goods supplied and sales-based royalties.

    Other key provisions would include the following:

    The duration and territory of the franchise;
    the franchisee's obligations and minimum performance requirements;
    price and payment for supplies of stock; royalty levels and payment;
    records that the franchisee must keep for your inspection;
    your obligations to support the franchisee;
    confidentiality issues; termination arrangements and your respective rights on termination;
    and applicable law and dispute resolution.
    Franchising is equally applicable for UK only or overseas use. Overseas, it may be appropriate to appoint a national head-franchisee to monitor and police local sub-franchisees.

    Competition law must also be taken into account in developing collaborative arrangements such as Manufacturing Licences and Franchising. EU competition law prohibits agreements or concerted practices which prevent, restrict or distort competition and affect UK and/or EU trade

    Hope these points would help any of you how is thinking to go into franchising. Also - have a look at this franchise directory it might give you some ideas.

    Good luck everyone!:tup:
     
  16.  
    danieldarmody

    danieldarmody Applicant

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    OMG this franchies is SHOCKING!

    I recently started a franchise.... I had no idea what I was letting myself in for.
    I did have a little bit of marketing exprience but had never been able to make these things work. I had spent several thousand on the last failed attempt and had nothing to lose. But nothing prepared me for what happened next.

    Now I was getting much different results. which was shocking as I didn't have a massive marketing budget... infact I wasn't spending a penny on advertising. It was the amazingly well planned system that was converting. At least 1 in every 3 people that came to my site left their details asking for more information.

    so fastforward a few weeks: I now have people in my business Im making sales for the 1st time.... but there is more.

    Discover more : secret business marketing

    heres the mission:

    To "empower individuals with opportunity and facilitate humanitarian and environmental aid where it is needed in the world".
    Through their partnerships with non-profit and research organizations, including The Hunger Project, Rooms for Joy, Trees for Life. Members will be able to use their resources to create a real difference in the lives of thousands of individuals worldwide. Projects will include the implementation of sustainable farms, institution of clean water utilities, assistance for the terminally ill and disabled, distribution of food and resources, resources and education for children in need, environmental aid and more.


    Discover more : secret business marketing
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    Jump on the free webinar here: free webinar
     
    Last edited by a moderator: Aug 30, 2010
  17.  
    Mark

    Mark Moderator Staff Member

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    Do tell...
     
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    dirtmaster

    dirtmaster Applicant

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    I've been toying with the idea of franchising my business for years now. I have loads of ideas but i have no idea where to start selling the franchise? trade magazines? online? trade shows?

    Suppose i should be looking at putting systems in to place before i think about selling territories.
     
    Last edited by a moderator: Sep 14, 2010
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    Det

    Det Applicant

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    I have experience of franchising from both sides of the fence.

    A few years ago I bought a franchise from 24/7 staff, I parted with several thousand pounds and before I'd even finished my training they disappeared leaving me without anything to show for my money. They were a large company too with many successful franchisees, I know because I made a point of contacting most of them and visited several outlets. However this did not put me off of franchising in general. It's still a great way to gain back-up and support in business.

    I'm sure that most people on here would agree that any business that has been around for a while has learned an enormous amount about their industry. Most of the wrinkles in their system have been ironed out and they have learned what works and what doesn't. This is what a franchisee pays for; specific industry knowledge. Whether that is worth the thousands of pounds some franchisors are asking for their brand is debatable.

    Now I am franchising my own business and charging only £699 for a two year licence with no monthly fees. I've purposely set the licence fee low so that although it's enough to prove the franchisee is serious, if they don't make it they haven't lost their house. I'm not daft and understand that some people will fall away when they realise they have to actually work to be successful. (Why is it that no matter how many times you tell people that they'll have to work hard to make a success of something, there are always those who won't believe you?)

    After costs, I earn nothing out of the licence but we supply the finished product so we will gain regular income from the sales the franchisee makes. The important fact here is that if the franchisee makes no money then we make no money so we have a symbiotic relationship. I have to make them successful or I suffer.
    In my opinion that is what makes a good franchise and is the question every prospective franchisee should ask. How much does the franchisor gain if the franchisee fails?
     
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    Make It Cheaper

    Make It Cheaper Applicant

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