Australian Franchise News – 03-02-11
Since the first franchise opportunities landed on Australian shores in the early 1970’s, we’ve been fascinated by the franchising concept. Remarkably, Australian franchising now consists of over 70,000 franchised units from over 1,000 different business concepts, employing nearly half a million people and contributing $37bn annually to the national GDP. Those are some serious numbers.
Yet people still have the misconception that Australian franchise opportunities are a licence to print money. This is not the case. A franchise is not a business, but a business model. The franchisee still needs to work at developing the business, and there is a right way and a wrong way to approach getting into business for yourself.
Let’s look at some of the key things that you need to consider when you are looking at opening your own franchise business.
Know Your Passion
First things first: what do you like doing? They say that if you enjoy what you do, then you never have to work another day in your life. Find something that you really like and explore those options.
The good news is that almost every type of business has a franchise opportunity. So whether you’re keen to sell signs in Canberra, be an event planner in Brisbane, offer branded uniforms in Sydney or develop outdoor advertising in Perth, then there is a business concept for you.
How Much Time Are You Willing to Invest?
An important question to ask yourself is – how much time are you prepared to spend in your business? Is your intention to run the business hands-on, or are you planning an investment strategy?
Most, if not all, franchise opportunities require a significant investment of time over the formative years of the business (12-36 months). Regardless of the business type, you need to understand the mechanics of the franchise model and the profit centres involved, to know how to maximise your return on investment (ROI).
Home-Based or Retail?
There are multitudes of businesses today that are home-based franchises. Franchises like Plan Ahead Events (discoverplanaheadevents.com) – an event management franchise, and Billboard Connection (billboardconnection.com.au), an outdoor advertising agency, are two that fit this mould.
For many, the flexibility of being able to work from home has many advantages, particularly for those with young families. Many home-based franchises also have the advantage of being low overheads, low rent, few (if any) employees and flexible hours.
Then there are those that like the face-to-face interaction of a retail business. The obvious trade-off can be the long hours, the reliance on staff and the fickle nature of retail – as many retailers can attest over the past 2 years.
Look for the Growth
Even through the GFC, there were certain industries that not just weathered the storm, but continued to thrive. Business to business (B2B) franchises like sign franchise Sign*A*Rama (signarama.com.au) and promotional products and uniform franchise EmbroidMe (embroidme.com.au) have continued to set new sales volume records, according to United Franchise Group’s Australian Director, Evan Foster.
“We’ve seen some fantastic results from our stores as our brands awareness continues to grow,” said Foster. “We’re now starting to find that people are searching for our stores by name, not just finding us randomly through the Yellow Pages or the internet.”
Get a Feel for the Operation
Probably the most important part of your process is to get a feel for the franchise model that you’re buying into. Not just reading and researching the model, but visiting stores, speaking with existing franchisees, spending time watching and observing the way it works.
All good franchise companies will provide you with the opportunity to visit with their franchise owners, so that you can get the answers to your questions straight from the horse’s mouth. It’s a good sign when your prospective franchise partner invites you to investigate the inner-workings of the model.
Put a Pin in the Map
So where to open? The Australian franchise market is very mature, with most cities and towns saturated with franchised business. There are, however, some great pockets where great opportunities still exist. Places like Canberra, Darwin, Hobart, Townsville and Bunbury (to name a few) are ideal for the right franchise opportunity.
Aside from these considerations, you need to of course seek advice from your solicitor, business advisor and/or accountant. This will enable you to take the emotion out of the equation before you sign a franchise agreement. Going through the right processes will ensure a higher likelihood that you will make the right decision for you.
So what are you waiting for? You’ve always wanted to be your own boss. There has never been a better time.
Request information on franchise ownership of EmbroidMe franchise