What Is Franchising?

Franchising is not limited to burger bars – there are over 670 businesses that are franchised in the UK, from plumbing through retailing to will-writing services. Whatever kind of business you want the chances are there's one to suit you.

The industry is growing too - last year the turover of the franchise sector was £9.5 billion, and increase of three per cent on 2001. Training is now provided by 99 per cent of franchisors and nine out of ten franchisees reported profitability in 2002.

• But before you start looking for a franchise it pays to do your homework:
  
• Find out about the concept
  
• Check whether franchising would suit you – running a franchise is not everyone's cup of tea
  
• Check what you can afford – you have to pay for franchises so if you want to start a business on a shoestring you may have to forget franchising
  
• Check what kind of franchises are available – there is a huge range so there may well be one to suit your own interests and needs.
  
• Pick the right one for you – running a franchised business can often be hard work so you have to be fully committed to it or it risks becoming drudgery
  
• Know where to find out about franchising and get expert help
  
• Talk to several people who already have franchised businesses to find out what it's like at the sharp end.
  
• Contact the franchisors that you are interested in.
  

What is franchising?

It's a way of setting up in business for yourself but not on your own. With a franchise you run the business, but using methods that have been already tried and tested by another company, called the franchisor.

You pay the franchisor for a package that gives you an exclusive 'territory' and allows you to use its brand name, methods of operation, technology or products for a certain period, say five years, on a renewable contract. Once accepted as franchisee you get technical and/or business training, operation manuals, often marketing help and sometimes accounting or other administration services. In return, you agree to run the business according to the franchisor's methods and standards.

Make sure you are well briefed about what franchising means in practical terms before you start looking for a franchise. It's worth investing time and money on research – it could save you far greater sums and a lot of heartache later on.