I’ve been reading this thread with great interest over the Last few days and this is my thoughts on the matter.
Many years ago a friend of mine moved back to the UK after living abroad for a few years, (fortunately, or un-fortunately as it turned out) he had a few quid in the bank to invest in a business so he decided to buy a franchise (making sandwiches and delivering them to shops, garages etc. )
He thought it would be the right thing for him so after investing his money then recruiting 2 early morning staff to make them and 1 driver to deliver them, small industrial unit, fridges, van and the list went on and on.
After about a year or so he finally cottoned on to the fact that he was forever paying out money for the running costs of the business plus his percentage to the franchise owners, he infact was slowly but surely getting deeper into debt.
Eventually he sold it on at a great loss and went to work for someone else rather than being his own boss, during this period of his life he almost lost his home and wife due to the stress.
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Now I for one do not know what Ian or any other party is offering with a franchise, it may be a good deal for some but not for others the big question is would I buy in to a franchise?
The answer simply is NO!
Why?
(1) because I do not need to,
(2) I would rather be in control of my business
And third being as follows
(3) I’m not sure of the set up cost of the franchise but figures that have been spoken about on this forum are as follows.
Set up £15,000 followed by 15% of the generated income (hope I got this right?)
Expected income to be £4000 - £5000 per month
Okay so lets go with these figures, if these are correct and you pay £15,000 then achieve the £5000 per month (certainly not unrealistic)
You will have made £60,000 in your 1st year but then you will have to pay your 15% (£9000) plus set up cost of £15,000 so you will have paid out a total of £24,000.
Now lets look at this at a different angle
Buy a half decent van £5000
Buy a diy system £1000
Total outlay £6000
Employ a canvasser to build a round for you @ twice face value (the norm)
Do this in a steady affordable package ie,
1st month he gets you £2000 worth you pay him £4000 (approx earnings £500 per week)
If you required double this amount ie £1000 per week (over 4 weeks) you would have paid your canvasser £8000 in total, bear in mind once paid for it’s all yours and no percentage to pay on it each month/year.
You could alternatively buy a round @ 2 times the turnover (again the norm)
By using this method you would have paid out a total of £14,000 to get a van, system and round together (cheaper than a franchise but more importantly) SOLE OWNERSHIP
Let me just finish by saying these are just my thoughts and have no beef with anyone trying to start up a franchise (good luck to them) it’s just not for me.