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What Makes A Good Franchise Business Opportunity?

Updated on June 4, 2013

The first decision that you need to make is whether or not your business is actually suitable to franchising. You don’t just need a business that is profitable, you need one that can be replicated and relocated.

For instance, if you have a profitable plumbing company in London, are you confident that using current business processes, you could replicate its success with a branch in Birmingham or Manchester?

Lots of businesses are profitable, but not all can be replicated. They might have been developed over decades and this is time that a new franchisee does not have. They want to start generating leads from day one. The good franchise opportunities are those that enable the franchisee to develop these leads quickly but also consistently.

Obviously money is a huge factor. What are the start-up costs for equipment and marketing materials? If you are lucky enough to have no other competition in your industry when it comes to franchising, then you will be able to add a few thousand pounds to your fee, for some instant profit. Then you need to start thinking about royalties.

A good business opportunity is one where the royalty fees to the franchisee almost go unnoticed.

Another thing to consider is exclusive areas. Exclusivity is something that all franchisees want. They might be investing £50,000 or more, so they will want to peace of mind knowing that someone else is not going to come and tread on their turn any time soon. In the plumbing example mentioned above, you might offer cities such as Manchester, Birmingham and London. On the other hand, county exclusivity might work, so you could offer franchisees exclusivity in areas such as the West Midlands or Herefordshire.

What Niches Are Going To See The Highest Levels Of Growth?

Times are changing and a lot of businesses are no longer operating in the traditional ways that they used to. Technology has played a major role in this. As an example, think of the stock market. 1000s of shouting traders have been replaced by computer screens and online trading platforms.

Technology, therefore, is certainly one of the markets that are going to see high levels of growth. Most companies nowadays are outsourcing and a lot of this outsourcing is related to IT related services. If you are looking to create a high growth franchise operation, then an IT company could be the goldmine that you are looking for.

Food and drink franchises have always been popular. Look at the likes of McDonalds and Subway. Of course, to create a successful operation, you need to have an incredible brand image. The type of image that enables Subway to charge over £4 for what seems like a normal sandwich and McDonalds £2 or more for a takeaway coke which could be purchased from a store for half the price.

Other Factors To Consider

Some of the simplest franchises are some of the most profitable. Each business has a range of key components that help to build a mechanical profit system that doesn’t need fixing. For example, a food store might rely on an excellent product, low price and great range. All of this is going to be useful if the location is not ideal. The same goes for an IT outsourcing company, they need to be visible online in order to attract a high level of clientele.

Working With A Franchise Service Company

Every business owner has the dream of creating something special; something big. The problem is that there are a lot of road blocks on the road to success. For many companies, boosting their business can only happen with the help of a franchise service company. Franchising a business enables a business to expand quickly, yet they will not have to outlay huge amounts of cash investing in new equipment or marketing.

Is Your Business Suited To Franchising?

There is no particular business niche that is suited to franchising. Instead, it really relies on the current structure and stability of a business. A business that has been profitable consistently is obviously structured in the correct manner. Although it might not be feasible to directly replicate that business in entirety, the business model behind it can be adapted and made suitable for franchising.

Whether you own a cleaning company, offer consulting or even sell products, there is a chance that your company could benefit from branching out into franchising.

What Are The Advantages?

Franchising is nothing new; it has been popular since the 70s. Why does it continue to be so popular? The advantages of making your small business a large franchise operation are never ending. Growth is something that comes from investment.

Thanks to hard economic times of late, most companies simply do not have the capital or time to expand. Selling franchises allows you to continue to grow your brand, yet you won’t have to invest anything. In fact, you will be receiving cash as a reward for expanding instead of outlaying it. Cash comes in the form of upfront purchase fees and ongoing royalties.

The most successful businesses in the world rely on their brand image for success. As a small business owner, you probably have not benefited from this. As you develop 5, 10 or even 100 franchisees, your company branding will get noticed, consistently. This means that you can create a brand image for your company, without having to invest heavily in marketing campaigns!

How Are Franchises Developed?

Although you might have a proven business model, that is not to say that it will be a smash hit when it is franchised. In order to ensure that your company reaches its optimum success level, you will need to employ the services of a franchise service company.

They are able to advise first of all, whether your company is going to suitable. From there, they will break down every section of your business. Although your company might be profitable, there might be aspects of it that simply would not work when it comes to franchising.

A franchising company will help to add uniform to your company. Essentially, what they are able to do is de-clutter your business. This is not just going to ensure the success of your franchisees; it will also help your business to run a lot smoother in the future.

Analysis is a huge part of making the transition from making your small business, into a successful franchise operation. A franchise service company will analyse how your business operates, the market place, the competition and the opportunities for growth in the future.

As they see each aspect of your business, they will try and simplify processes as much as possible, without compromising the long term results. This ensures that when franchisees buy in, they are able to understand how to run their business successfully as quickly as possible. This will also reduce the amount of input needed from you.


You could realistically, develop a franchise operation without the help of a franchise service company. Of course, this is the short cut to save a small amount of cash. By taking this short cut, you are going to lose out on lots of helpful advice and support.

Consider using these companies as an investment. You might pay for it now but by implementing proven successful strategies, you will receive pay back for many years to come! They will be able to help you with everything from marketing to potential franchisees and smoothing out daily business processes, to ensuring that your profits are as high as possible.


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