BBC Working Lunch Page
BBC Lunch Lesson 5: Franchises
BBC Why Franchise?
Franchise Directory Choosing a Franchise
Why buy a franchise?
Franchise Fees
Franchises Worksheet
Go to 1 What is Franchising?
The BBC says that franchising is
"It's when a business owner - or franchisor - allows others -franchisees - to use it's name, products and goodwill."
Of course they used it's when they should have used its. Nevertheless, expand on this definition by assuming that you are explaining franchising to one of your parents who is thinking of becoming a franchisee.
2 Franchising Fees
Franchisors typically charge an annual "management fee" on the basis of percentage of turnover: this can be anything from 10% to 25% of turnover.
What is a management fee and what are possible alternative bases for charging management fees? Why don't franchisors use them?
3 Franchises on the Web
Take a look at GreenThumb for an example of a simple franchise and a simple but useful site.
Now go to FranInfo and go to the Franchise Directory and have a look at who does what, who is offering which services. You can use this to assess which franchise might be most appropriate in your area.
Choosing a franchise takes you to a screen that contains the following information:
Choosing a franchise is a major life decision. The following articles give you advice as to how to go about choosing a franchise:
Advice from The British Franchise Association
Franchising - A Profitable Partnership
Safety First! A Guide to the Legal Pitfalls
a According to Brian Smart what is the value of the Franchising industry in the UK?
Additional Information for you
WhichFranchise.Com has a massive stack of resources relating to Franchising. Scroll down a little to their list of apparently useful insights into such matters as
Why Buy a Franchise
but I'm afraid you'll get precious little additional advice.
However, take a look, a bit further down the left hand side of the screen at some specific franchises and you arrive at a screen that contains
Basic Details
Hint: You can use this information as you work through question 3f
4 Investment in Franchises
The following table lists the Minimum Personal Investment and the Minimum Total Investment you would have to make in each of the franchises listed. What are the factors that determine the amount of investment needed, in your opinion?
7 October 2001
on Franchising, the second and third links on the left of this page: read what you find. Then work your way through this worksheet: there are lots more links and guidance to keep you busy and informed!
Brian Smart
Director General of The British Franchise Association
David Costello
Senior Franchise Manager, NatWest UK
Mark Abell
Partner, Field Fisher Waterhouse
b On what bases does the British Franchising Association assess a Franchise operation?
c David Costello of NatWest lists some of the advantages of franchising: what are these advantages?
d What does Costello advise you to do before you agree to become a franchisee?
e What does Mark Abell mean by "The old adage "marry in haste, repent at leisure", is just as true of choosing a franchise."
f Abell details several legal aspects of franchising that a potential franchisee needs to take into account and be happy about. Take a look at a franchise operation of your choosing and investigate each of these aspects. Compare your results with your friend and see how these aspects vary from franchise to franchise.
Franchise Fees
Is Franchising Right For You
Assess Yourself
Evaluate Market
Assess Franchisor
…
20 Questions
Operational Manual
About Us Financial Information Who's Ideal for Us
Locations Training and Support Related Articles
Contact Name
Address
Postcode
Tel No
Fax
E-mail
Website
Minimum Personal Investment
Minimum Total Investment
BFA Relationship
Franchise Type
Development Type
Industry
Business Description
Franchise Minimum Personal Investment Minimum Total Investment
Pizza Hut 50,000 150,000
MacDonalds 40,000 150,000
Domino's Pizza 60,000 160,000
O'Briens Irish Sandwich Bar 40,000 80,000
Snack in the Box 10,000 18,080
Dyno Locks 8,000 32,000
Kall Kwik Printing 45,000 120,000
Pronta Print 35,000 120,000
CNA Executive Search 15,000 20,000
Tax Assist Direct Ltd 10,000 15,750
CerTax Accounting 6,000 15,000
I took the information for this table from the links I found for Additional Information for you on this page.
© Webmaster Duncan Williamson 2001