Property Franchise Frequently Asked Questions

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Property Franchise Frequently asked Questions
Many people who want to invest in the property market full time would be wise to consider investing in a property related franchise.

What is a franchise?
A franchise is a type of business which involves two parties, a franchisor who agrees to licence their branding and business model to a franchisee then markets and sells the franchisor's product or service.                

What questions should I ask about franchising?
There are lots of questions you should be asking, but here are some handy checklists: from The Franchise Magazine and FDS Franchise

What types of property franchises exist?
There are many different property franchises that you could invest in from estate agency and letting franchises to garage conversion; making and fitting sash windows; roofing; gas and electric surveys.

What does a property franchise cost?
There are normally two costs associated with investing in a franchise. Firstly there is a fee that you pay to the franchise owner which can covers a variety of things including training and support to set up and run the business. The other cost is usually secured via a loan and covers equipment such as a van, office and marketing. You will also pay a 'royalty fee' on all of your sales back to the franchisor.

What are the differences between buying into a property franchise versus investing directly in property?
The difference between franchising and buying property is that you are buying into a proven model with expertise which helps to ensure your business is a success. You might find yourself maintaining other people's property rather than your own or being paid to add space to someone else's home with a garage conversion. However there are some franchises that actually work by directly investing in property.

Can anyone be a franchisee?
Most successful franchises are built by the franchisor by carefully selecting the right franchisee to work with. It's not that different to being employed by a boss. The franchisor will decide whether they think you will be successful and whether they think they can work with you (and vice versa). The screening process will also help you to find out more whether this is a franchise you want to buy into.

How much can you earn from a property franchise?
Your potential earnings will depend on the type of franchise you buy into and the amount of effort and work you put into making your franchise successsful. Earnings are usually freely advertised by the franchise owner. Gas-Elec advertise earnings over £50k; Dyno Rod claim their franchisees turnover around £1 million with 10-20% profit.

What restrictions will a franchise place on the business I run?
There will be a legal agreement between you and the franchisor. This will layout the requirements (and restrictions) that you have to adhere to as a franchise owner. Typically restrictions include use of the brand and what supplies/services you have to purchase from the franchisor.

Can I buy a franchise that is already up and running?
Yes you can. Some franchise owners build the business to a certain level and then decide to sell them on to a new owner.

Where do I find out more about property franchises?
The British Franchise Association is one of the best first ports of call to find out if franchising is right for you and what opportunities are around. Visit British Franchise Association shows and read the Business Franchise and Franchise Magazine

Visit our Property Franchise page for more information about potential property franchises to investigate.

 

 

 


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