Franchisors make their money through charging franchisees fees to start and operate under the franchise name. Before considering going into a franchise business you need to assess whether you can afford the up-front and on-going fees necessary to operate the system, plus wages, stock and training costs, as well as survive the lead time it takes to build a successful business.
By law, franchisors must provide quantifiable information on their business background, knowledge and experience, development strategies, corporate structure, financial arrangements and business references. And once made available, this information needs to be assessed.
It is wise to seek out independent advice from an expert, talking to either an accountant or business consultant. Advantage Accountancy has exceptional experience in this field and can assist those considering a franchise business venture. Principal Adrian Garrone has first-hand experience with franchises, having successfully introduced the first Bakers Delight franchise in Cairns and later opening two Muffin Break stores.
Adrian knows what to look for in the financial reports provided by franchisors, he knows what questions to ask, and through personal experience can interpret the financial and sales data provided.
It is vital to have confidence in the franchisor and Advantage Accountancy can provide that assurance.