When faced with unexpected job loss due to corporate layoffs, many individuals find themselves reevaluating their career paths in order to keep attaining the financial freedom they hoped for and planned for. Business ownership, particularly through franchise opportunities, is becoming one of the most popular avenues to explore. With an increasingly competitive landscape, buyers are looking for clearer, more straightforward answers to their most common questions. As the leading network of franchise consultants, the International Franchise Professionals Group (IFPG) is here to provide those answers.
Whether you’re an aspiring business owner new to the franchise industry or simply an experienced investor looking for reliable guidance and resources, our purpose-driven mission is based on integrity, ethics, and collaboration. Here, we answer the most frequently asked questions from investors just like you, who are looking to invest in a franchise business in light of job losses due to corporate layoffs.
What Is Franchising?
Franchising is a business model and method of distribution that helps entrepreneurs realize their dreams of business ownership in well-known, recognizable brands. It involves the relationship between franchisor (the business offering the franchise) and the franchisee (the business buying the franchise).
What Is a Franchise Broker?
Franchise brokers, or franchise consultants, are individuals or firms licensed by the franchisor to represent prospective franchisees. Franchise brokers act as intermediaries between the two parties and are essential for a successful franchise agreement. They provide guidance and direction for potential franchisees, filtering opportunities, fielding inquiries, assisting with financing options, and more. Put simply, these brokers give investors the peace of mind to ensure their future franchise business will be a success.
What Franchise Opportunities Are Available?
A successful franchise is built on a partnership between buyers and sellers. Before executing an agreement, it’s important that both parties share the same vision and meet the franchise’s criteria. Franchisors list the required investment, criteria, fees, royalty costs, needed qualifications, ongoing training and support, and other various operating costs, so potential buyers can gain an understanding of the franchise’s terms. Some of the most popular franchises in the US are McDonald’s, Subway, Dunkin’ Donuts, and 7-Eleven.
What Are the Benefits of Investing in Franchises After Corporate Layoffs?
Whether you’re a professional looking for your next big opportunity or a self-made investor seeking a more independent lifestyle, franchisees can be key players in successfully navigating job loss due to corporate layoffs. By investing in a franchise, you can take advantage of the strong name, support, proven operating system, and successful marketing process of a big-name brand. In addition, proven franchises offer investors the potential to share their business decisions and profits, while having flexible and semi-absentee models — enabling maximum profitability and minimal risk.
What Steps Do I Need to Take to Become a Franchisee?
The process of investing in a franchise can be detailed, complex, and involve numerous steps. Prospective buyers should begin by exploring what franchise opportunities are available. The search can involve speaking with others in the industry, conducting research, attending conventions, and speaking with experienced franchise brokers.
Assuming that a prospective franchisee shares similar vision with a franchisor and meets their necessary criteria, a buyer will then need to complete the necessary paperwork, secure financing, and develop a timeline for purchasing an existing business or launching a new location. A franchisee must also complete any necessary training required by the franchisor.
How Can I Obtain Financing for My Franchise?
Franchise financing may be available from banks, private lenders or even through the franchisor itself. Franchises often have less competition and offer a lower risk of failure to lenders, meaning that most franchisors will have some sort of financing option for prospective buyers. You may use the assistance of a business consultant or franchise broker to help connect you with the right sources of capital for your business.
What Types of Support Are Provided to Franchisees?
In addition to the detailed Franchise Disclosure Document (FDD) — which outlines the franchise agreement and terms — at the IFPG, our experienced franchise brokers provide invaluable advice and insight to buyers during their decision-making process. Our vendors also offer a variety of essential services from website design to payroll and more.
Is There a Way to Get Started in Franchising Without As Much Financial Risk?
Yes! In order to become a franchisee, you don’t need to own all the required assets or build the business from the ground up. The IFPG’s trademarked turn-key franchise ownership model allows aspiring business owners to hit the ground running by purchasing an existing franchise.