joining a Franchise

[ducdo]

my DH is not happy at work and keen to join a franchise for a car maintenance type company.

His passion is cars, so the job content sounds good and something he will be good at and enjoy, however my concerns are the initial cost outlay (around 15-20k which we would need to take loan out for) and how much salary he would make.

we have 3 children and lots of commitments each month so he needs to be earning a certain amount for us to survive.

Whilst I want to support him, I worry whether he is going to make enough money.

Has anyone joined a franchise or have any experience of this... all the advertising and marketing sounds a bit too good to be true!

I don't have direct experience of being a Franchiseee, but I think you are right to be concerned.

Like everything there are good and bad franchises - you need to read the small print carefully... what EXACTLY do you get for your money? I'll bet there is no guarantee of work/income - probably just an agreement that you can 'own' a geographical region without competition from within the franchise.

Many franchisees still have to chase their own business - how good would you/DH be at that? how good a name/reputation does the umbrella company have - do they advertise? Do they have existing contacts/ customers to pass onto you?

Sadly I think the people who usually make money from franchising are the owners themselves....

Are there any members of the franchise that you could talk to and see how much they are earning?

Google and see what you can find - I'm pretty positive there will be a franchise chatboard type forum.

Thanks both.

The one my DH is interested in, we actually used them once to get some work done on our car and still have the contact for the person who did the work. I did suggest to my DH that he get in touch with him to see if he could be really honest about what it's really like and ask him how much he earns, but wonder whether the person will reveal as much as we want to know!! bit personal really... worth trying though..

I worry that they are all biased towards the company and not give a picture of what its really like!

just need to do lots of research I guess..

Apart from the well know brand franchises, I have never come across one that you couldn't set up yourself for a fraction of the cost. Most have high head office fees and you are usually tied to them for admin that you could pay a lot less for. They also promise x amount of leads - these are usually not as 'hot' as they make out and it is extremely difficult to convert them into money.

There is no harm in checking it out, but please do it with a cynical eye and get a second opinion from an accountant/solicitor on the information you get from them.

I spent a lot of time looking into buying a franchise. It is a well established high street shop based one. We were going to buy the franchise for a whole area and we would have had franchisees under us paying franchise fees to us as well as our own shops.

I visited quite a lot of the local shops.

What I found was that almost all of them were really just about earning a living and the master franchisor was making most of the money. To be honest pretty much all of them would have been better of just getting a job as a shop manager and not having the hassle and risk of running a business. I was quite shocked at what I found.

I looked at a few other franchises (not van based ones though) and came to a similar conclusion. A lot more franchises go out of business than they tell you in the literature. Many are bought back in for a small amount of money by the master franchisor so they never actually go bust so they dont get reported as failures.

In short, I would advise great care and be very sceptical about any financial projections you are shown.