Invest in a Franchise

Are you thinking of investing in franchising or opening a business and do not know where to start?

The current context of crisis in Europe has produced an increase in franchise investment as an idea to open a business.

On the one hand, the franchisee is less likely to be under the command of a company that is already powerful. So it is easier to recover the initial investment.

In this article we will present the multiple advantages of opening one in the UK.

WHAT IS A FRANCHISE?

The first thing that we must be clear about is the franchise-based business model.

As we have said, it is a business model that has two parts: the brand owner and the recruit.

For its part, the company owner owns a brand that is already consolidated in the market. To expand your business, you assign the right to use your brand to other people, which in this case are franchisees. The use of this right is limited both geographically and at a specific time.

Franchising a company is one of the best decisions that can be made by the owner of a business that is already successful in the market.

ADVANTAGES OF OPENING ONE

THE RISKS OF THE INVESTMENT ARE REDUCED

Although, as in all businesses that start from an investment there are risks, in this model, they are reduced. This is because the brand is already established and consolidated in the market.

The public already knows it, so, if the franchisor has a good brand image, success is practically assured. So much so, that studies show that businesses that are opened through this system are the least likely to close.

BUSINESS PROFITABILITY IS GREATER

If we measure the economic benefits compared to the expenses that result from opening a business, the model is more profitable than the traditional business model.

From the beginning we already have a prestige as a result of the leading brand that will give us the possibility of saving expenses in multiple business areas.

In addition, business growth will be greater as the company is expanding through several territories and is known to more public.

For this we must be guided by the company owner at all times , since the good work of the franchisee following the steps of the original owner, will be of utmost importance for the business to prosper.

A LOWER INVESTMENT IS REQUIRED

Opening a business through a franchise means reducing investment costs. One of the main reasons is because the franchisee belongs to an economic and logistics chain, so he can take advantage of economies of scale and the advantages derived from it.

When the company makes orders to all its workforce, it asks for larger quantities, so the unit cost is reduced. In addition, you can get better competitive advantages as a result of negotiation, since they are strong groups within the market.

TERRITORIAL EXCLUSIVITY

The franchisee has the exclusivity of the area, since an approximation ratio is established in which it cannot open another business of the same brand. This way it is easier to reach your target audience.

Looking to buy into this business? If so, check out http://approvedfranchises.co.uk where you can get customised quotes from up to 4 companies that match your individual circumstances.