Are you recently retired from a successful career and looking to stay business active? Investing in a franchise could be the perfect way to do that. Franchises provide you with an opportunity to establish a business while taking advantage of a proven system. However, there are many questions that come up when considering a franchise, which is why the International Franchise Professionals Group (IFPG) exists. This article explains our mission, answers frequently asked questions, and more, so you can get the most out of franchise investing.
IFPG is a membership-based franchise consulting network with over 1,300 franchisors, consultants, and vendor members. Our members provide their expertise in helping individuals continually identify and invest in franchise businesses. As a group, we focus on promoting integrity, collaboration, and ethical practices in order to support aspiring business owners.
When it comes to investing in a franchise, many people have questions around cost, ROI, management style, and more. To make things easier, we have compiled some of the most frequently asked questions that arise when considering a franchise.
What is the cost of investing in a franchise?
The cost of investing in a franchise depends on the size of the business, the brand, and more. Most franchisors require an up-front franchise fee and will also charge ongoing royalty fees, which typically range from 4 to 8%. When choosing a franchise, you also need to consider the cost of materials, real estate, equipment, and inventory.
How long does it take for a franchise to turn a profit?
How quickly a franchise turns a profit depends on many factors, including local market conditions, the management style of the business, and more. In general, studies have shown that most franchises take about six to twelve months to see a return on their investment.
Can I secure financing for a franchise?
It is possible to secure financing for a franchise through a variety of lenders and government agencies. Franchisors may also offer assistance with financing and will typically have relationships with lending institutions that can help you fund your venture. It is important to research all of your options thoroughly and ensure that you are working with trustworthy lenders.
Do I need special permits or licenses?
It depends on the type of franchise you are investing in. Food-based franchises, for example, may require a foodservice license. Retail franchises may require permits from the municipality in which the business is located. It is important to research the specific permits and licenses that your franchise will need.
Can I own multiple franchises?
Many franchisors offer multi-unit discounts and other incentives for those who are interested in owning multiple franchises. However, depending on the franchise, there may be restrictions or special considerations when it comes to owning multiple locations. It is important to discuss this with the franchisor before investing in multiple units.
These are just some of the most frequently asked questions when it comes to franchise investing. If you have any additional questions, the experts at IFPG are here to help. Our members have extensive experience in franchising and are committed to providing aspiring business owners with the information they need to make informed decisions.