|
There are many individuals who like yourself, want to be their own boss. They
see no long range security in working for someone else, and/or may feel that
their potential income will always be limited as an employee.
Franchising offers these individuals an opportunity to break free & own their
own business whilst at the same time minimising the risk that is inherent in
opening an entirely new business from scratch.
Franchising allows you to follow a tried and tested business system which will
greatly improve your chances of success, as the statistics prove.
History of Franchising
Franchising first became a recognised force in the UK during the
1970's. In 1977 the British Franchise Association was established by the
industry to provide industry self regulation.
Below are the highlights from the 2008 National Westminster Bank Plc and
British Franchise Association UK franchise survey:
The annual NatWest/BFA franchise survey monitors the performance, attitudes
and opinions of the UK franchise sector and thereby builds up a larger picture
of the contribution of franchising to the British economy.
The 2008 NatWest/BFA Franchise Survey, now in its twenty-fourth year, remains
the leading study of franchising in the UK. To order a copy
click here.
General
- The franchise industry is now estimated to be worth £12.4 billion.
- The overall number of franchise systems is 809, an increase of 3% on the past
five years.
- There are an estimated 383,000 people employed in franchising.
- The average (mean) turnover for a franchised business is £360,000.
- The vast majority (91%) of franchisees say their business is profitable.
- The amount borrowed to finance a franchise varies greatly between different
franchises. The average is just below £70,000.
- Property services are now the largest sector. Personal Services are the second
largest.
- The internet is the main recruitment channel.
- BFA membership has also increased again with 45% of franchisors members.
Relationships
- Relationships between franchisees and franchisors are healthy, with 88%
reporting satisfaction in their dealings.
- 65% of franchisors state the greatest hindrance to franchisor growth is the lack
of suitable franchisees.
- As many as 88% of franchisors are now using the internet as a method for
recruiting new franchisees.
Profile of Franchisees
- 86% of all franchisees are married.
- The average age of for a franchisee is now 47.
- 66% of new franchisee recruits are male.
- The personal services sector has the largest proportion of female franchisees at
61%.
- The number of graduates operating franchise units is 37%.
- A quarter of new entrants are of Asian background.
Benefits of franchising:
Better chance of success
Research has shown that of all businesses starting today, only 20% will still be
trading in 5 years time. With franchising these figures are reversed. The reason
for this represents the other benefits of franchising.
A Proven Business
With franchising you are buying into a business that is already operating. The
Franchisor will have made mistakes along the way and will have learnt from them.
This knowledge is passed on as part of the franchise system. It enables you to
start your business at a much higher point on the learning curve.
Support
Within a franchise there is or should be a great deal of help and support
available. The support that you will need will change as your business grows.
From day one you will need training and will be reliant on the Franchisor. As
you become established, you will benefit from different types of support such as
staff training and National account business. It may well be possible to
collaborate with other franchisees on larger projects and just being part of a
larger organisation can help.
Problem solving
From time to time you are going to hit problems. Your Franchisor should be able
to provide you with the necessary technical support. However it is invaluable to
be able to talk things through with other franchisees, or the support team who
may well have dealt with the same problem recently.
Management support
Many Franchisor's will hold review meetings with you to discuss all aspects of
the business. You will be able to check your progress, celebrate your successes
and plan for the future. Many businesses have failed in the past due to lack of
good business advice.
Product Research and Buying Power
As part of a franchise network much of the product research and testing process
will be carried out for you. It is also possible to take advantage of group
buying discounts
Conclusion
Franchising enables you to become involved as part of a company that has
established a tried and tested system and has achieved some market share and
name awareness. When starting a business as a self employed person you will make
mistakes which can be costly if not catastrophic. An established franchise will
have ironed out those problems. They will have a written system contained within
the franchise manuals as to how operate the business so as to achieve maximum
sales and profitability from day one. It is effectively the name awareness and
the system that you are paying for.
One of the most important aspects of becoming a franchisee is that help is on
hand at every stage. The Franchisor will provide initial training, launch and
marketing support and day to day help. The fact that as a franchisee you are in
business for yourself but not by yourself is a major factor in the improved
success rate that is associated with franchising.
If you decide to buy a franchise, do not relax and wait for the Franchisor to do
all the work, that simply won't happen. Franchising can provide a structure and
a proven system but it is still your hard work and effort that will be decisive
in making it work.
For more details on what a franchise is please visit our what is a franchise? page.
|
