Know more about the costs involved in franchising
At present, you will find that many people want to be entrepreneurs. If you also possess the same ambitions then invest in franchising instead of opening a new business. This is because franchising involves less risk and more profits than a self-owned business. In addition to this, franchising allows you to sell products and services which are already famous and recognised in the market.
Once you pay the required amount of money to the franchisor then you can easily enjoy the various benefits offered by them. Here is more information about the fees which are involved in franchising:
To use the franchisor’s name and its assistance, you (franchisee) need to pay a specific amount. The fees are divided into three different categories.
• First of all, you need to pay the initial fees which may be non-refundable. This fee may cost the franchisee several hundred pounds. The fees include the cost of the outlet. In addition to this, it also involves the insurance and licence fees.
• Continuing royalty payments – These payments or fees are paid by a franchisee to the franchisor on the basis of their monthly or weekly income. These royalties are generally paid for using the brand name. The monthly or weekly fees need to be paid for the duration which is fixed in the franchise agreement. • Lastly, the franchisee also needs to pay advertising fees to the franchisor, as they help in promoting your business through national advertising.
Although, you may need to pay these amounts to the franchisor initially; it will be beneficial for you in the long run. After clearing all these matters with the franchisor, you can control and run the franchise store in the best possible manner and increase profits.