With all the news about the recession, many would be business owners are unsure about starting a new business from scratch.
Franchising might be the answer.
“Franchising lets people get into business for themselves, but not by themselves,” says Paul Anstis, founder and CEO of appliance repair business Arrive On Time Appliance Repairs. Here are a few things to consider when thinking about becoming a franchisee.
Unlike a new business, a franchise comes with automatic brand recognition, meaning the franchisee doesn’t have to invest in getting the word out. Franchisees also receive comprehensive initial and on going training in all aspects of the business and management support from the franchisor.
“Becoming a franchisee is a natural for someone willing to let other people make mistakes on their behalf in advance,” says Paul. Founded in 2000, Arrive On Time Appliance Repairs is now expanding its operations in NSW and the ACT.
“We’ve built a Company that allows franchisees to be more flexible and have a more balanced lifestyle, yet produce a sustainable income and have an appreciating asset they can sell.”
The difference between starting a business and buying a franchise is the same as the difference between building a house and buying a strata unit. A unit owner must adhere to the rules of the strata title. Franchisees are required to operate their franchises according to a franchisor’s policies and procedures. Thus, the franchise model doesn’t leave much room for creativity. However, a good franchisor will hold regular meetings with their franchisees to always improve the running of the brand together.
“You don’t invest in a pizza store because you want it to sell tools,” says Paul from Arrive On Time Appliance Repairs. “You have to follow the system that has been laid out. People from the emergency services and the armed forces make awesome franchisees as they are more disciplined and are used to following a system.”
The investment is just that, an investment. The great thing is that the franchisee has the power to increase their investment by working hard and growing their territory, while earning a good income. They can take on new territories and realise the profit when they sell part or all of their business.
What to look for
Ask questions. Any reputable franchisor will be used to being asked questions. Talk to all existing franchisees. Search the Web for chat group discussions about any given franchises. “If a group of franchisees aren’t happy, they’re going to talk about it,” Paul says.