1. What Is a Franchise?
A franchise is a business model where an entrepreneur (the franchisee) operates under the brand, systems, and support of an established company (the franchisor). The franchisee pays fees and royalties in exchange for training, marketing, and brand recognition.
2. Why Start a Franchise?
- Lower risk compared to starting from scratch
- Access to proven business models
- Established brand recognition
- Training and ongoing support from franchisors
- Easier access to financing compared to independent startups
3. Steps on How to Start a Franchise
Step 1: Research Franchise Opportunities
- Explore industries you’re passionate about (food, retail, services, fitness, etc.)
- Compare different franchisors and their success rates
- Consider demand in your local market
Step 2: Understand Franchise Costs
- Franchise Fee: Initial payment to join the franchise
- Royalty Fees: Ongoing percentage of revenue paid to the franchisor
- Setup Costs: Premises, equipment, and staff
- Marketing Fees: Contribution to national or regional advertising campaigns
Step 3: Create a Business Plan
- Outline investment needs, financial forecasts, and growth strategy
- Highlight your management skills and market knowledge
- Use this plan to apply for franchise business loans or grants
Step 4: Secure Funding
- Government-backed startup loans
- Bank franchise loans
- Private investors or personal savings
Step 5: Legal Requirements
- Review and sign the franchise agreement
- Ensure compliance with UK Franchise Association (UKFA) or equivalent bodies
- Seek legal advice before committing
Step 6: Training and Setup
- Attend franchisor training programmes
- Secure a location (if required)
- Hire and train staff
- Launch marketing campaigns
Step 7: Open and Operate the Franchise
- Follow the franchisor’s systems and guidelines
- Provide excellent customer service
- Monitor performance and seek ongoing support
4. Costs of Starting a Franchise
- Small home-based franchises: £5,000–£15,000
- Service franchises (cleaning, tutoring, fitness): £15,000–£50,000
- Retail and food franchises: £50,000–£250,000+
5. Benefits of Starting a Franchise
- Strong brand recognition
- Ongoing training and support
- Easier financing options
- Shared marketing campaigns
- Higher success rate than independent startups
6. Challenges of Starting a Franchise
- High upfront and ongoing fees
- Less creative freedom—must follow franchisor rules
- Reputation risks if the franchisor or other franchisees underperform
- Long-term contractual commitments
7. Tips for Success in Franchising
- Choose a franchise that aligns with your skills and interests
- Research demand and competition in your area
- Understand all costs and profit potential before investing
- Build strong customer relationships
- Stay engaged with franchisor support and training
Frequently Asked Questions
Q1: How much money do I need to start a franchise?
Costs vary, but some franchises start as low as £5,000, while popular food franchises can exceed £250,000.
Q2: Do I need prior business experience to run a franchise?
Not always—many franchisors provide full training and support.
Q3: Can I get a loan to start a franchise?
Yes, banks and government-backed loans often support franchise businesses.
Q4: How long does it take to start a franchise?
From research to opening, it can take 6–12 months depending on the franchise.
Q5: Can I run a franchise from home?
Yes, some service-based franchises (consulting, tutoring, digital marketing) are home-based.
Q6: Is franchising less risky than starting my own business?
Yes, franchises have higher success rates due to proven models, but risks still exist.
Conclusion
Knowing how to start a franchise gives you a clear path to owning a business with reduced risk and strong support. By researching the right opportunity, understanding costs, securing funding, and following proven systems, you can build a profitable and sustainable franchise business.