Are Franchises a Good Idea?

Are franchises a good idea? The answer to that question usually depends on the person you’re asking. Some people have made an entire (and very profitable) career out of owning franchises, while others feel it’s the worst investment decision they’ve ever made.

Franchises, According to the Numbers

In 2010, the United States as on the backside of a serious recession. Many businesses folded, and everyone was worried about the state of their investments. Despite the fact that so many people were still struggling to make ends meet, franchise owners reported good earnings for the year. The average franchise owner grossed between $75,000 and $100,000 and about 30% of all franchise owners reported earning more than $150,000.

It is important to remember that those numbers don’t tell the full story. For example, getting your branch of a franchise up and running isn’t cheap. It’s a serious investment. The average franchise charges a franchise fees that ranges from $50,000 to $75,000 and in most cases, that fee only covers things like training and using the franchises name. Additional start-up costs include choosing a location, building, paying various legal fees, purchasing various building and business permits, purchasing the initial inventory, and setting up a staff. When all is said and done, you should be looking at a few hundred thousand more.
Despite the fact that the initial investment is often huge, many franchise owners not only enjoy a successful business venture but are so pleased with the results, they purchase additional locations. Some stay loyal to the same franchise while others try to protect their investments by investing in different types of franchise opportunities.

How to Make Your Franchise Location a Success

Before you take advantage of a franchise opportunity, commit yourself to making it successful.

First, take advantage of every training opportunity the franchise organization offers, they’ll provide invaluable insight. You should also choose a franchise with an organization that has a history of running regular evaluations and offering advice when a location isn’t performing as well as expected.
Second, plan on staying active in the running of your location, at least for the first few years, this keeps managers and employees honest and ensures you have a solid understanding of how the facility runs.
Third, don’t try to save money by skipping out on local advertising. You’ll be surprised by how much business the local advertising generates. Also, be an active member of the community. Sponsoring youth sporting events, hosting community meetings, and purchasing market livestock at the county fair goes a long way towards building a solid and loyal customer base.


  1. Very informative article, Which you have shared here about the Franchise business. Your article is very useful because it nicely describes the essential points about the Franchise businesses. Jafdivineherritage offers the Franchise investment opportunities in Nigeria.


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