Franchising TNT

If you have looked at franchise opportunities and did some research, then you will have seen the term franchise fee. In this article, we will discuss how franchise fees work, what reasonable ones are and how to analyze your franchise agreement to determine if you’re making a smart decision or not. After reading this article, you will be able to understand franchising fees in their proper context, and improve your chances of entering into a great franchise opportunity.

A franchise fee is what the franchisor charges for use of brand-name. In other words, they leverage all their marketing and advertising dollars and the position they created in the customer mind to command a fee. In exchange for that, you benefit from getting customers who already have a favorable expectation of what your franchise does for them.

The franchise fee is determined by how much the franchisor believes the business system is worth. Naturally, different franchising fees vary depending on the development of brand, the proven track record of the franchise itself, and the system of processes and services that have been created within the franchise.

Sometimes a franchise fee includes training and ongoing support. Typically, if there is a low franchise fee, it generally means that once the transaction is complete, you’ll be on your own when it comes to staff training and support for your franchise. Depending upon your experience in running businesses successfully, this can be good or bad. If you’re good at running a business, then the ongoing training and support are probably something you don’t need. On the other hand, if you’re an experienced, than it might be well worth the franchise fee you’ll pay in order to get the proper support.

Finally, party or franchise fee goes into the advertising and marketing budget of the franchise system itself. If you don’t contribute to the marketing, then nobody can benefit from the branding this marketing creates.

The best way to be confident in exactly what your franchise fee includes, always be sure to pick up the UFOC and any other documents that are available. Before selling franchises, the franchisors are required to submit certain financial documents that outline what support they will be offering. It is important to thoroughly look over these documents, because they include any lawsuits and litigation that has been brought forth to the franchisor since they have been in business. You may be surprised at how little of support is delivered by some of your favorite franchisors. The UFOC is your best bet at seeing exactly how franchisors spend your franchise fee and royalties.

In order to understand if a franchise fee is appropriate, you must do the proper research. Compare it to other competing franchises. Get a franchise lawyer to go over the agreement with you. The franchise fees are relative to the context. Depending upon other parameters in the franchise agreement, franchise fees will vary. By knowing how to analyze a franchise agreement, you automatically know whether the franchise fee is reasonable or not.

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In high times and low times franchising has proven to be successful, and as we face a time of recession, looking at business options that have a safety valve built in is important for many of us.
There are those who’ll simply opt to lie low in times of financial uncertainty, while others, aware that the show must go on, are on a quest to find recession-proof businesses that represent a safe investment and offer assured success.
Franchises are known to do well because they are very often an established known brand and use an identifiable and proven method of operating designed to produce profits.
In terms of investment, banks and other lending institutions have long been in favor of putting up funding for franchise businesses over independent concerns because of formers track record for success.
Of course, not all franchises survive, so when you’re considering buying one it’s prudent, naturally, to look at those with a reputation for steady growth and profit.
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Keep Your Investment Safe Choose Wisely

In the current financial climate, anyone considering buying a franchise is well-advised to analyze predicted behaviors of consumers. Okay, so that well-known brand of fast food restaurant has been in business years, but is now really the time to buy one of their franchises? Possibly not. The fact is that when people feel the need to cut their expenditure luxuries like pre-prepared meals or take-out are amongst the first things they decide to forego.

Safety in Necessity

So while franchises are in general considered safer investments than other business formats now really is a time act with caution. Looking at low cost franchises is recommended, those with an affordable set up fee. And consider too what the ongoing running costs and overheads might be of a particular concern. The more overhead bills you have to hit per month, the higher your profits will need to be the harder you’ll need to work.
So what is a safe and recession-proof franchise? The simple answer is one which provides a necessary service or product, something people will always need, despite the financial situation in the world.
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A WSI consultancy franchise fits the bill perfectly. The company is a Canada-based Internet and Technology Solutions provider who have been assisting small and medium sized business in achieving success on the Internet for over a decade. They provide a necessary service, with more and more people looking to the World Wide Web as the environment in which they conduct business, professional help of the kind WSI offers is a need rather than a luxury if the said businesses are to thrive.
A WSI consultancy franchise is also priced at just below $50,000. The fee is all-inclusive and running costs are nominal. Franchisees can run their consultancy businesses from home, another plus which also offers respectable tax benefits.

Just a few of the reasons franchising, in particular WSIs consultancy businesses, are successful and safe investments.

If you have set your mind for franchising your business then you have taken right decision as franchising the existing business is the fastest way of expansion. It is a natural and fast method for growing business. The next thing that you want is to do it properly as small mistakes can lead you in big trouble in future. Try to counsel it with experts before deciding anything.

Franchising a unique way of business expansion as here you partner your existing business with someone else. You sell your business and strategies to new business owner. This requires utmost care and discipline. You should be clear on everything whether it’s your expansion plan, business strategies or future plans. You should be clear at every point. An experienced franchise consultant can help you and show you the right way to do the things. They can assist you in many ways like creating operations and other franchise manuals, solving different questions that generally come on when you go for franchising, making your attorney and planning franchise system and many more.

There are many franchise consultant out in the market but do go for anyone offering you to open your franchise. There are many people who just managed to add the company name in their client list to as they have done franchise work for them but have little knowledge. So decide your consultant wisely. Always try to cross check his knowledge by asking few questions and give your contact to him once you are satisfied.

Having a franchise is a great way to start a business, without having to worry about coming up with your own business model. When you have a franchise, you have the convenience of having an established and recognized brand to develop, plus the support of a head office that will help you succeed. The key to your success is to pick one of the best franchises to own so you can have a business that is sure to succeed.

Cartridge World is one of the best franchises to own and has one of the lowest amounts of money needed to get stated. With a starting liquid capital of only $30,000, you can be on your way to supplying customers with ink refills for their home computer printers. Because it costs much less to have an ink cartridge refilled than to buy a brand new one, more and more people are turning to this as a practical and economical way to get their printing needs done. Another one of the best franchises to own is Dollar Store Services. With a liquid capital requirement of only $50,000, you can be on your way to owning a business that is sure to draw huge crowds in any neighborhood, regardless of the type of economy the country is in.

The convenience store 7-Eleven is another one of the best franchises to own. With the wide number of products it offers, plus the added income from the food service section of the store, a well located store can generate thousands of dollars in income for you. The start up costs are quite high, since you will need about $100,000 to $160,000 in capital, but this can be easily recovered in a few years. Everyone loves to eat and so it makes sense that if you want to start a business, choose one of the best franchises to own that serve food. Whether you want to have a juice bar or a fast food joint, having a restaurant franchise can help you become an entrepreneur and help cater to the demands of your neighborhood.

On the top of the list of best franchises to own that serve food is McDonalds. This fast food chain has served over a billion customers and to this day continues to be very competitive in the fast food market. With new offerings every year and classic menu items that remain popular with the fans. McDonalds has high recognition and brand value. It does require a huge capital startup, reaching upwards from a million dollars, but you can be sure that you’ll get it back within a few years.

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Are you wondering how sports franchises are started? There is a wealth of information about franchising on the internet and finding a franchise opportunity is easier than you think. The most important thing is to find a suitable niche that appeals to you and that you follow the franchise agreement and manuals you receive. Sometimes you can begin a sports franchise for as little as $5,000.

Sports franchises come with many exciting bonuses. First of all, the customer base for this type of franchise is usually established and fiercely loyal. The brand name is already associated with quality and performance so you need to do very little work, and a sports franchise requires very little startup cash and investment. Additionally, the franchising business in general is low-risk with only 5% resulting in failure (compared to more than 50% for small businesses). Each franchise can be examined to see which suits you best.

When most people think of a sports business franchise, they think of basketball, baseball, football and hockey logo jerseys, jackets and hats. However, there are also sports-themed businesses to consider. For instance, Snap Fitness is one of the top-producing fitness franchises because their gyms are open 24/7, their employees are knowledgeable and they use the best security surveillance systems to ensure safety. Sports retail franchise, Nevada Bob’s Golf, offers specialty golf products. Future Stars Sports Photography is a training center for sports photography offering great products and customer service.

There will always be a place in America for sports franchises. Locals will always want merchandise and memorabilia for their hometown heroes. Yet in some instances, dream teams or playoff teams entice fans from beyond their borders to buy. According to the Ultimate Standings list, the top ten franchises (in order) are: the Indianapolis Colts, the San Antonio Spurs, the New Orleans Hornets, the Green Bay Packers, the Anaheim Ducks, the Los Angeles Angels, the Detroit Tigers, the Detroit Pistons, the Jacksonville Jaguars and the Arizona Diamondbacks.

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Franchising is a popular business model world wide and over 21 million jobs in the Us are generated by franchising which is a approximately USD 2.3 trillion industry.

In any venture or business the foundation to security and success is the contract or agreement. While a franchising business will run on organizational ability, commitment and passion the peace of mind will come from having a contract that protects you legally and takes care of your interests.

A franchising contract lays down the rules and is binding for both the franchisor and the franchisee (you). It is advisable to get efficient legal counsel during the buy/sell process of a franchise. An experienced lawyer will help ensure that the contract covers all important aspects of the venture.

The most important/ crucial things are:

1. The purchase agreement must define clearly the franchising package; the services; and the price.

2. The license part must cover: the rights of the franchise; the obligations of the franchisor; the responsibilities of the franchisee; the trade restrictions; the termination conditions and so on.

3. Ensure that the agreement permits you to use patents and trade marks, any secret methods/ formulae, recipes, copyrighted materials, identified suppliers and so on.

4. Understand the franchisee promises. There will be restrictions pertaining to operations, advertising, training, insurance, corporate image, look and feel and so on. Be clear that you will be able to toe the line. If you have any questions clarify them before signing the contract.

5. The contract must define clearly what the franchise package will include. It would cover aspects like equipment, inventory, training, accounting procedures, collaterals and so on.

6. Be clear about what the initial services umbrella covers. These may include site selection assistance, marketing services, setting up on signage, look and feel of interiors and so on.

7. Arrive at an agreement about termination policies. Define the terms clearly. Understand the laws and regulations that apply. Define the minimum advance notice period. The termination clauses should be fair for both you and the franchisor.

8. Make sure the contract includes a assignment/death clause. In event of death a representative or dependant should be allowed to keep the business going.

Before signing a contract it is important to read through a draft contract with an experience lawyer. Know what clauses are negotiable. Determine clearly what your responsibilities will be and find out about what kind of hand holding is on offer. Many franchisors offer help until the franchisee is well settled and understands the ropes. Be sure to examine aspects like business background, litigation history, bankruptcy and insolvency information, and financial statements. Familiarize your self with franchising laws and regulations that apply to your state.

Begin a franchising business smartly and on the right foot understand the pros and cons clearly.