11 February 2013
Category:
Franchising
Comments: Comments Off on Are You Sitting On A Gold Mine?

Are You Sitting On A Gold Mine?

Do you have a successful business?  Have you weathered the economic storm?  Do you have one or two locations or territories?  If so, it is time to think about expansion again.

 Francorp frequently talks to business owners who express their desire to expand, but realize that they have limitations.  They don’t have the capital, the people, or the time to achieve their desired growth.  If you feel like this describes you and your company, then it is time to realize that you are worth more for what you know than what you can achieve in a day working in your business.  The question is, how can you take advantage of this knowledge and “cash in” on those great ideas that you have been honing for years.  One way to do so is to revisit the idea of franchising over opening a new company-owned store.

 In a world with multiple business models, a company-owned store is a tried and true approach that does not always maximize on its full growth potential.  Today it is harder than ever to produce the capital needed to generate a new storefront location on a company’s own dollar.  With current credit restrictions and collateral requirements, it is even harder to acquire loans and investments.  A franchise expansion model allows you to capitalize on other people’s money while at the same eliminating the burden of staffing and managing a new location.

Franchise companies typically earn an upfront “franchise fee,” averaging roughly $35,000, on top of the investment that the franchisee is making to start the business.  In addition franchisors earn an ongoing royalty payment averaging 6% of gross sales.  Some franchise companies even sell products to their franchisees as an added revenue stream.  Franchising is an expansion model that allows companies to replicate their operations and brand name while utilizing the money, time and motivation of individuals that are looking to start their own business.

The issue of franchising or company-owned units is one of the many topics of Francorp’s online “How to Franchise Your Business” seminar that is available FREE when you mention this newsletter ($195 value).  To learn more about franchising, visit http://www.francorp.com or call 800-372-6244.  As a reader of this newsletter, to sign up for your FREE seminar ($195 value) or take the FREE franchise quiz, click the buttons on the left for direct access.

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