Why Invest in a Franchise?

When people hear the word Franchise, they immediately think about Fast Food and McDonalds. That’s understandable because Fast Food is one of the largest Franchise industries in the world and McDonald’s with over 40,000 Franchised locations around the world is one of the largest. But there are many more products and services that are Franchised and here’s a list of ‘just a few’ of the main ones:

Franchises by Industry:

Advertising & Marketing, Automotive, Business Consulting, Car Wash, Children’s Education, Residential & Commercial cleaning, Computer & Internet, Dry Cleaning, Employment Services, Financial Services, Fitness, Food, Health, Beauty & Wellness, Home Improvement, Management Training/Coaching, Pet Services, Printing, Real Estate, Senior Care, Sports.

Here’s an overview of the 6 Main Types of Franchise Investments:

  • Unit Franchise – this is what most people start with as it is a single Franchise usually in a protected territory
  • Multiple-Unit Franchise – some people grow into additional Unit Franchises after they build their 1st one successfully. But, some Franchisors offer multiple-unit Franchise purchase up front so they can have that same person building a larger territory.
  • Master Franchise – purchasing the Franchise Rights to a State or Province or even a Country, then you are trained to sell Unit Franchises (Sub-Franchise) in that territory and earn multiple revenue streams from Franchise sales, Royalties and other services.
  • Passive Investor – You can invest in the Franchise but you will need to hire someone to be trained and operate the Franchise.
  • Part-time Owner Operator – You invest in the Franchise and hire a part-time manager and you work the Franchise together.
  • Resale Franchise – These are Franchisees that have decided to sell their Franchise to retire or, for various other personal reasons. Executive Franchise Match has a number of resales available in various markets at various times and we’ll help you through the due diligence process and we can even suggest a Franchise Lawyer to assist you.

The Main Benefits of Investing in a Franchise:

  1. Proven Business Model – Starting a business idea from scratch is very difficult and expensive and it’s hard to know if your idea will ever be successful. By investing in a Franchise you have all kinds of information available to see if the Franchise has proven to be successful based on their track record and by talking to existing Franchisees.
  2. There’s lots of choices – Once you’ve decided on a specific Industry, product or service, there’s usually a few choices of Franchise Brands you can choose from. Executive Franchise Match can help show you these choices and help you decide the best fit for you.
  3. Strong Brand – With a Franchise, the brand name is usually established especially if it’s a mature Franchise with 100+ Franchises in the system. This can help you scale your business much quicker.
  4. Advertising and Marketing Systems – All successful Franchisors have a proven Marketing system that can help you target the right customers and save you money. You can leverage the buying power of a big Franchise system and you don’t have to waste time and money through trial and error by experimenting with various Marketing systems.
  5. Training – All Franchisors provide full Training. They teach you the system that works, how to select the right location, the right Marketing tools, the right way to attract customers and the proper way to interact with customers so you can sell your product or service.
  6. Ongoing Support – Many people question why they have to pay a Royalty, the simple answer is to get ‘ongoing support’ from the Franchisor. The Franchise Fee that you pay to buy the Franchise is to acquire the Rights to the Brand, the territory and the Training. The Royalties are needed by the Franchisor so they can continue to have their staff support you everyday during the term of your Franchise Agreement which is typically 5 or 10 years. That’s why it’s very important to ensure that you do your homework by talking with other Franchisors during the Discovery Process to get a feel for the type of support a Franchisor is providing.
  7. Lower Risk – As mentioned earlier starting a business from scratch is very high risk, where a Franchise with a proven success has a much lower risk factor.
  8. Easier to get Financing – Most lenders are more willing to finance you for a proven Franchise system than on a new idea. Also, many Franchisors already have lenders in place who believe in the Franchisors’ concept so, the approval process can be much simpler.
  9. Higher Profit Margins – Profit margins vary depending on the Franchise but whichever Franchise you invest in, the Franchisor has developed a way to maximize profit in that industry through their own trial and error and selecting and negotiating the best suppliers for their Franchisees.
  10. Easier to Sell your Franchise – You can sell your Franchise at anytime during the term of the Franchise agreement. Typically, the Franchisor has 1st right to buy it at an agreed price. If they decide not to purchase it, they will typically help you sell it to an existing Franchisee, a Candidate that they may have in the system or because of the brand recognition, there could be more buyers ready to purchase your Franchise.

Executive Franchise Match does NOT sell Franchises. We LISTEN to our clients and help them explore many Franchises opportunities that match their business Background experience, their personal Interests and financial goals and their Budget.

Our Consulting service is FREE so, it costs you nothing to work with Executive Franchise Match and have us help you find the right Franchise Match for you.

“Mike was very patient with us through the entire franchise search process. He clearly understood our interests, background and budget. In the end we made a great choice and we are now very happy doing what we love and making an excellent income with our Senior Care Franchise.”  

– David and Marianne – Toronto, Ontario