Every entrepreneur dreams of expanding their business in the future and coming to the point where you actually can, must feel really great! The decision to franchise your business is a huge step that can be both thrilling and nerve-wracking.
But knowing what to expect can lessen your worries and give you the opportunity to take precautionary measures. So before opening a franchise business, here are some things you should know more about! Check it all out down below!
How Much Does It Cost To Launch A Franchise?
Depending on the location, type of franchise and industry, the cost may vary. But an average franchise startup can cost as low as $10,000 or as high as $5 million. Usually, they fall between $100,000 to $300,000.
This can give you an idea of how much you need to prepare before choosing to open a franchise. You can also ask other franchises in the same industry or do your research on your own. So before opening up a franchise, make sure to know how much it costs to set up and if you can afford it.
Do Franchise Owners Make Good Money?
Usually, yes they do. An average of $82,000 annually is what a franchise owner makes in the restaurant industry. So you can say you make a hefty profit from owning a franchise business compared to a non-franchise that only makes around $24,000 to $155,000 a year.
Do Franchise Owners Have To Work?
Yes, they do. But only because it’s important they know what’s happening and how their business is running. Tending to your business first-hand, then simply getting updates from store managers can make such a huge difference.
Knowing that owning a franchise can be taxing and requires you to work about 60 to 70 hours per week. But the satisfaction of knowing that your hard work is what made your franchise successful will make every working hour worth it.
Do Franchises Pay Taxes?
Yes, they do and it’s called franchise tax. This is not an income tax since this does not replace federal and state income taxes. Franchise taxes are paid in addition to income taxes and can vary depending on the state you’re in. These are paid along with other taxes.
How Do I Start A Franchise Business?
Choosing to expand your business is a big step to take as a business owner. But knowing when you’re ready can be a pickle. Down below will be a list of things you need to start your franchise business, and if you think you can check everything out, then you’re ready to start!
- Make sure your business has a functional system, a specialty, a patent brand, own products and is doing well.
- Get a financial disclosure document, in other words, FDD.
- Make a draft of a franchise agreement.
- Create a guide for franchisees’ operations.
- Come up with a new and improved business plan
Should I Get My Franchise Business Insured?
It is your duty as a business owner to consider the safety of your enterprise, your staff, and your customers. Getting your franchise business insured is a great way to effectively do so. Some might overlook it without knowing the dangers you’re exposed to without business insurance.
You’re exposed to lawsuits, financial losses, damages from accidents and disasters and many more. Having business insurance can financially protect you from all that and even more!
So if you’re wondering where you can get business insurance, it’s best to consult with an insurance advisor. They’ll be able to help you find the best insurance coverage suited for your business’s needs.
Plus these also come with benefits! Not only does this protect you from lawsuits, damages from calamities, and damages from accidents, but this also makes your business more credible to clients, keeps your employees safe and can even save you more money in the long run.
Take away
Now that you know all the frequently asked questions about opening up a franchise business, you can now use this to your advantage. Now you’ll know exactly what to expect, what to avoid and what to do when you choose to franchise your business! Not only that, but now you also know how you can protect your business.
