How Much Can You Expect To Earn From A New Franchise? We Look Over Some Factors To Establish This
When looking for a new franchise in the UK you will want to know how much money you are likely to make when you in invest in a particular franchise opportunity. The first thing I would mention is that be very careful of franchise companies detailing how much you are likely to make as these can be misleading because of area and industry. You must insist upon a written substantiation of any earnings projections or statements when you buy a franchise about your potential income or sales.
By law a new franchise is not required to make earning statements, but if they have made these statements then the franchise governing rules requires the new franchise to have a reasonable basis to make these statements. They also will have to provide a document that details these claims and how it is achievable. Make sure to read through this document and review each section, consider the following when looking how much you can earn from a new franchise.
Review Size and Average Earnings, many franchisors claim that a new franchise opportunity may earn, for example, the franchisee 40,000 in the previous year. This statement may be misleading because only a few franchises may have earned this amount and it does not represent the earnings of the franchises in total. Make sure that you find out how many franchises were included when coming up with this number. Some franchise may be very successful and increase the average amount of the total earnings so take this into account when you buy a franchise as the franchise system may look better than it actually is.
Gross Sales, some of the new franchise offers include figures on their gross sales and revenues of each franchisee. These figures will not tell you much about the expected earnings because if one franchise has a high gross income on their books they still might be losing money as their business may have high costs. The actual earning potential of any franchise opportunity must take these factors into account.
Location, earnings may vary dramatically depending on where you are in the UK. When looking at an internet franchise opportunity then this section is less relevant because of the nature of the business and how accessible it now is. However, there are still some areas that struggle to get a good broadband connection so the chances for earnings will be less. If you are located in a city location then the chances of business to business opportunities are far greater than if your location is in the countryside. Remember that a new franchise has set locations and areas so make sure that you fight for the best location to make you a greater income. You don’t necessarily have to live in that location to buy a franchise there.
The Franchisees Background, many new franchisees have a varied range of knowledge and experience when working on the internet. These franchisees may have come from another job within the industry or may have done a training course and decide to try it out. The franchisees that have more experience and knowledge will earn more than their counterparts. The success of each of these new franchise opportunities is no guarantee that you will be equally successful.