The franchise industry is by no means a low cost solution to purchasing your own business, as such it can be very worthwhile to purchase new franchises which have only been on the market for 12 months or less. Some of the main benefits of purchasing new franchises are:
1. Cost – As new franchises are looking to gain a solid franchisee base early on, they often keep the cost of purchasing the franchise very low and in some cases pilot franchises may be offered where they cover part of the cost of setting you up in your new franchise business. Shopping around for new franchises can save you many thousands of pounds.
2. Support – The franchisor will be looking to have his new franchisee’s performing well so that in the years to come people looking to purchase their franchise can contact the existing franchisee base and see that they are all running in profit and have everything promised in the marketing materials. As such you will find that the franchisor is very likely to bend over backwards to accommodate their new franchisee.
3. New emerging markets – Not the case for all franchisors but many new franchises tread new ground and have unique offering. If you can be in there from day one you can take advantage of the new markets opened up and often be at the forefront of cutting edge new technology and markets.
4. Marketing – Every business likes to start with a bang and the franchise industry is no different. If you can sign up with a new franchise business that is looking to make a name for itself you can benefit from all the additional marketing that they will do in the first 12 months of operation. With a new franchise business comes added press exposure and you can take advantage of the brand name being displayed in newspapers, online print, magazines and even television media shows.
One must always be careful of course when buying into an untested model and as such when researching new franchises for sale you really want to be looking into the background of the franchise company and ensuring that they themselves run the business model well and in profit and hopefully have done for several years. This shows the business is a viable one and can give you peace of mind that the franchisor knows what they are doing. This is not the case though with all franchise opportunities as some have been known to go in head first with the franchise model having never ran the business on a standalone basis. Although risky this can still work and especially with new tech start-ups it can be hard to avoid this scenario.
The key to your success when purchasing new franchises is to do as much research as possible. Research the demographics of your suggested territory or area of operation. Fully research the company and of course ensure that the business is one that you feel you can run yourself and will not get bogged down with learning the ropes of an industry you have never worked in before or have no experience of.
Matthew Anderson is the author of this article and an expert in the field of franchising. With many New Franchises coming to market every week he deals with their advertising and marketing needs.