For recent college graduates, starting a business can be an exciting yet daunting journey. Luckily, franchises offer a low-risk way of starting and owning a business. Franchises are an especially attractive option for those who have limited business experience. Even better, there are many franchises that have low upfront investment costs, especially those that don’t require purchasing property. With so many options to choose from, there are countless questions that have to be answered before you decide on the right franchise for you.
The International Franchise Professionals Group (IFPG) is a membership-based franchise consulting network that offers guidance to business owners who are in the process of finding and investing in franchise businesses. This guide will explain the frequently asked questions about finding the cheapest franchise cost to ensure you make the most informed decision possible.
What Are the Risks of Investing in a Franchise?
Like any major business decision, investing in a franchise also involves an inherent risk. A franchise business owner must be aware of the risks before signing any contracts. While investing in a franchise may be less expensive than starting your own business from scratch, there will still be considerable financial investments involved. Questions to consider include the level of financial resources needed to start the franchise and the amount of personal funds and financial resources available to the business owner. Additionally, investing in a franchise could mean giving up control and/or the freedom to make decisions about the franchise.
What are the Most Affordable Considerations for Low-Cost Franchising?
When it comes to finding the most affordable franchise cost, there are several considerations to make. Firstly, consider franchises that require a smaller amount of capital to get started. Additionally, look for franchises that don’t require purchasing a physical property. Franchises such as home inspection, real estate, and cleaning services often require little to no physical property, making them more cost-efficient and affordable. Also, investigate the total cost of the franchise. While the upfront cost may seem low, don’t forget to research any additional costs such as royalty fees or advertising costs that may occur over time.
What is the Difference Between a Franchise and a Business Opportunity?
A business opportunity and a franchise are similar in that they both involve the sale or lease of goods or services. However, there are several essential distinctions between the two. A franchisor offers the franchisee, or franchise-buyer, the right to use the franchisor’s trademark, merchandise, and methods of doing business. A franchisor also provides training and support to the franchisee. On the other hand, a business opportunity requires the business owner to supply and attend to all the marketing and operational aspects involved. Additionally, business opportunities are not subject to franchise law while franchising requires complete adherence to state and federal franchise laws.
What is the Investment Range for a Franchise?
The investment range for a franchise varies based on the type and size of the franchise you’re looking into. Generally, there are three types of franchises: home-based, small business, and large business. Home-based franchises may require a lower startup fee and may only involve the inventor to make a small, one-time purchase of equipment while small business franchises require an initial investment of about $50,000-$150,000 and large business franchises require an initial investment of more than $150,000.
What Should I Look for When Choosing a Franchise?
When deciding on a franchise, it’s essential to review the franchise disclosure document (FDD) in order to make an informed decision. The FDD provides a detailed look into the franchise from the background of the franchisor, estimated costs and fees, and more. Additionally, research the brand of the franchise you’re considering, such as the product or service provided and management or training support. Lastly, learn as much as you can about the franchise business model. As an aspiring business owner, you want to choose a franchise that fits your skills and business goals.
How Do I Find the Cheapest Franchise Cost?
If you’re looking for the cheapest franchise cost, it’s important to assess all the costs involved in setting up a franchise. Thankfully, IFPG’s membership-based franchise consultant network offers help and guidance to aspiring business owners in the process of searching and investing in a franchise. With more than 1,300 franchisors, franchise consultants, and vendor members, IFPG is committed to guiding those seeking a low-cost franchise and provides them the opportunity to locate and own their ideal business.