Franchising

When setting out to franchise a business, the smart owner leaves nothing to chance. In the world of franchising there are pitfalls and obstacles in plenty, just in the regular course of transitioning a successful business into a successful franchising organization. Therefore, it is of vital importance to establish a well thought out strategic approach. For most, a franchising consultant is a key ingredient in creating a viable plan for making franchising a reality.

Why Use a Consultant?

Franchising a business may sound like a rather straightforward process. However, many business owners make the mistake of assuming that just because they created a successful business from the ground up that they have the business savvy to turn it into a successful franchise, as well. Though the business sense of the successful owner is unquestionable, it is important to understand that the world of franchising is much different from the world that the owner is coming from.

The reality is that transitioning from being an owner of a business to being the owner of a franchise is very much moving oneself into an entirely different line of business. Much of what an owner may think he or she understands about business as it applies to their established brand may not apply to the business of actually franchising their brand. A franchising consultant adds the needed and invaluable asset of experience in the world of franchising to the pre-existing framework of the owners drive and know-how.

What Does a Consultant Do?

Franchising consultants bring more to the table than just practical experience in the arena of franchising businesses. A good franchising consultant will conduct a level of in-depth analysis that will allow you to get a broad perspective as to the feasibility of franchising your business and what you might expect if you decide to move forward. A reputable and ethical consultant should be willing to tell you if your business is not really marketable as a franchise, even at the cost of losing consulting fees.

Most importantly, a consultant provides the practical knowledge to augment your vision and turn it into a reality. Think of it this way: you know your business and how to make it a runaway success. Your franchising consultant knows franchising the same way. Just as someone looking to make a start in your industry would benefit in using your system and business model, you can benefit from using the guidance of a consultant in franchising your business.

Can I Go it Alone?

Is it possible to franchise your business on your own? Sure it is. After all, you started your business from scratch, you have the drive, determination and, most importantly, good business sense to succeed. It isn't at all implausible that with enough research and time you could come to understand the business of franchising as well as you understand your own business. However, by going it alone you assume a greater risk of failure and commit yourself to spending a great deal of time learning what a good franchising consultant already knows. Ultimately, you have to decide what is best for you, your business and your vision for your business's future.

You want to be in business on your own. Either because you have no choice. You are out of work and cannot find a job. Or because you are tired of working for a boss. You are tired of knowing that any minute you can be fired and lose your job. You are tired of being told what to and when to do it. You are not a professional and your only options to your mind is either menial labor or starting your own business.

Check out franchise complaints.

Realizing that there are many risks in starting a new business and besides you can't really decide which business to start, you opt for a franchise. You have a problem and you imagine that owning a franchise business is the solution. Did you ever consider franchise complaints? Are you so blinded by the prospect of owning a franchise that you totally forgot and ignored one of the most fundamental principals of beginning a new venture. How are others who own a franchise doing? Are they happy and financially secure. Are there any franchise complaints? How many franchise complaints are there? How were the franchise complaints resolved? Were they resolved in an amicable way for all involved?

You are so needy of owning a business and franchise is the solution, that you don't want to look into any franchise complaints. You told yourself that anyone who has franchise complaints must either be too lazy to work the business or does not know how to run a franchise business. But you will we better. You won't have franchise complaints because you will do a good job.

You will spend hours of investigation before you spend money on buying a new suit or a new appliance. Yet you are willing and ready to spend anywhere between $20,000.00 and $220,000.00 for a franchise without doing all you can for due diligence. The very first step in due diligence before signing the franchise contract is to investigate if there are franchise complaints.

Investigation of franchise complaints.

Franchise complaints should be investigated on two levels. First, view complaints about all and any franchise. Second, view complaints about this particular franchise which you are interested in. If your particular company of interest has proportionately much more complaints than the average franchise company then there you have a burning red flag and be careful or better yet walk away. If there are complaints and the franchisees are not happy with the results be careful don't close your eyes and jump. Better to walk away now before you spend your life savings than to walk away two years down the track and having lost your life savings.

More about franchise complaints?

For a start remember this. Franchise companies will continue to make money whether or not you are successful with your franchise. First they make money when you purchase the franchise. Then they take their share of the gross sales whether or not you are making a net profit. The franchise company will not show you any sympathy just because after paying all the bills you are running at a loss. They will still take their share of the gross profits.

Some Jani King and Jan Pro franchisees complained about not being given worthwhile contracts. So although the company promised to give them a certain amount of contracts, they end up giving them contracts that have been quoted so low that you are not able to make a profit from the job. If you refuse to accept the job they are free from their obligation to provide you with jobs that they promised you. Because, they gave you the jobs and you refused to accept them.

For some Jani King franchisees things got even worse. After accepting a job they end up losing the contract. This is done when the area manager comes around to inspect his work and invariably will find small things wrong and tell you that since you are not serving the customer properly you cannot keep this customer. So sometimes even when you have a client you can lose the client in no time. The security that you wanted to have by joining the franchise is not there.

Franchise complaints about pulling out of a franchise ownership.

The worst part of buying a franchise is that it can be very painful and costly to back out of your commitments to a franchise. Some franchises that need to rent space to run their franchise may end up renting expensive shops with long leases that they cannot possibly afford to keep up the payments. When they stop making the rent payments they are in breach of the franchise agreement and the franchise company will buy back your business for a tiny amount of its real worth. All the contract will value for its buy back plan is the value of used machinery and product. No value will be given to the goodwill of the business. You may have been in a franchise business for 20 years or more. For sure there is goodwill value in your business. Yet, the contract calls for buy back based on the very little value of the machinery and goods.

Franchise complaints:

These are only some of the issues to think about.

Therefore:

(1) Do not feel pressured by anyone to rush into buying a franchise.
(2) Make certain that you know exactly what the escape plan for non performing franchise is.
(3) Do not trust the promises made by the company. Carefully read everything that you are told or promised.
(4) Be an informed consumer do a few Google searches for franchise complaints in general and a few Google searches for your franchise complaints specifically.
(5) Act with your brains not with your heart. Try to make inquiries from existing franchisees and use your intuition. If you feel this ain't gonna work don't do it.

If you search for one opportunity in business franchise you will find thousands waiting for you. One such option is the real estate franchise opportunity which enables you to open your business in real estate and construction. In fact the best way to succeed in the real estate sector is to get a franchise of an already proven name.

In business; reputation plays a major role. If you open your own real estate business people would take time to know about your quality work and you will have to try hard to get clients. On the other hand the franchise of a reputed real estate builder name can set your business on fire from the very first day.

How do you acquire a real estate franchise?

To grab franchise opportunities in real estate you will have to contact the owners of the business or their franchise section. In some cases they put their names in the list of franchise directories or franchise services.

People operating in franchise services act as consultants, (or middlemen) of the deal you made with your franchiser. Franchise services also provide innovative ideas of your business model and guide in all legal matters related to franchise.

In commercial real estate business anyone can reach the pinnacle of success within a short time-frame. Realtors have also realized the potential benefits of franchise and they have opened lucrative franchise opportunities for those who are looking for real estate broker franchise.

If you to wish to rise to the top in real estate business, go for a franchise. Prior to that you must learn certain things associated with real estate franchise. Real estate business basically depends the three features: Opportunity, Visibility and Profitability.

Opportunity: refers to choosing the right franchise. That is you have to get the franchise of the brand whose name brings clients to your business. Second is your visibility.

Visibility: If you can foresee which project will be profitable and which not, you can take right decisions about projects that would give you maximum profits.

Again there some matters that you must take care of while signing a deal for a real estate franchise. You must be clear about all legal matters, loyalty bonus and other sort of payments to your franchiser so that you don't have problems later in the business. In case you find difficulty understanding the terms and conditions you can consult a franchise consultant or an attorney.

You will find all information about any real estate franchise opportunity on the internet and in real estate magazines. So what are you waiting for. Go start your research for a successful real estate franchise business.

Houses and gardens are places which need just about continual upkeep. In the United kingdom there are actually over 25 million households living in a variety of accommodation which represents a massive potential market to anybody supplying services or products. Additionally, new houses and flats are built yearly which increases this figure continually. Home and Garden franchises chiefly concentrate on providing necessary maintenance services for properties and gardens. Some examples of the varieties of services offered are:-

Utility Franchise opportunities

These are necessary disaster or maintenance services for example Plumbing, Gas and Electrical services. There are also Disaster Management franchise businesses which take care of insurance flood/fire damage to residences.

House Restoration Franchises

These are greatly attractive services for providing some part of your home a 'face lift'. This might be inside or external door replacements and perhaps a brand new set of cabinet doors on your kitchen cabinets to offer your kitchen the most current look.

Outdoor Franchise businesses

There are a variety of garden upkeep franchise businesses for instance Garden Landscaping, lawn treatment and drive or passageway refurbishment/cleaning. It is possible to see that each one of these services are most desirable to house owners with a number of them being critical emergency response type services. This makes them excellent as franchise opportunities because there's frequent demand for this type of work to be carried out.

To run this kind of franchise it's important that you'd enjoy visiting customers homes and meeting others since you are prone to be in recurrent contact with them, whether you are planning a sale or whilst performing a job.

If you ever think that a house and garden franchise opportunity could be a very good option for you then its vital that you study your avenues properly. You can begin by reviewing some of the home and garden franchises you can find in online franchise directories. After making a short list, discover as much as you possibly can concerning the franchise you are interested in, their trade history, background and the folks who run the franchise. Then arrange to meet a couple of of the franchisors to receive some insight into their operations. It's also beneficial to obtain the contact details for a few of their franchisees to get hold of a little 3rd party outlook on how the franchise system works 'on the ground'.

It's also vital that you seek the advice of one of the high street banks. The majority of them have devoted franchise business sections that can inform on financing and could have heard of the franchise business you're looking to invest in. Probably the most central thing is take some time and ensure you take the very best choice for you. Don't be hurried, but ensure you feel relaxed and confident with your decision. No business endeavor is assured, but you can maximise your potential for achievement by being as clued-up as possible regarding what you are taking on.

Let's face it, growing a franchise company is not easy in the best of economic times, especially for newer franchise companies.  Selling the first five to ten franchises calls for a lot of time and effort. Remember when you started your business, the one you have now franchised? Remember all your hard work and effort to get it going ? Did it pay off? Of course it did, otherwise you would not have decided to expand. Well, your franchise company is a new business and as such it requires the same level of intense effort and focus of your original business. The good news is that in today's world of technology, marketing your concept and reaching potential franchisees has never been easier.

Even though you are granting franchises, there is no question that selling principles apply to developing your franchise company. When there is selling involved, we need leads, period. Growing a franchise is indeed a numbers game. We have to attract the right people in enough numbers to make the difference; and, the key to more leads is to have a multi-prong strategy to marketing. Here are some of the potential prongs:

Traditional Lead Sources

• Traditional Advertising (print media: newspapers, magazines, trade publications)- this is an expensive option and unless you have a very targeted market with an equally targeted publication, this is probably not the best way to go.
• Promoting franchise opportunities in your own locations - Obvious? Yes, but it's amazing how often this option is overlooked. Do you have signs that say "franchises available"? Do you promote your franchise on EVERY printed collateral in your locations? If you have franchise locations, are you also using them to promote the franchise opportunity?
• Franchise coaches/brokers (The Entrepreneur's Source, FranNet, FranChoice) - using broker networks is a great way to supplement your own efforts. However, you must spend time developing relationships with these people if you want to get results. Don't think that just listing your opportunity with them is sufficient. They have hundreds of options they can choose to offer their clients and yours will only come to the top, if and only if, you spend the time building relationships with the members.
• Trade Shows (Franchise/business opportunities shows and your own industry trade shows) - these lead sources can also be expensive and time consuming.  Do your research and only make the commitment if they have a proven track record of success.
• Seminars - This is an inexpensive way of building awareness about your franchise opportunity locally. It requires time and effort but they traditionally pay off, especially at a local level where your brand is known and respected.
• Networking - Have you told EVERYONE you know that you are now franchising? Have you sent them an email? Have you called them? Have you asked your friends to tell others they know about your franchise?

• Internet Referral Sources - Just do a search for "franchise opportunities" or "franchise leads" and you'll be amazed at the number of these lead source portals.  Some of these portals offer monthly agreements while others have pay-per-lead programs. Make sure that the leads you're getting from these sources have specifically requested information about your opportunity. If they are going to send you general leads you'll be doing a lot of chasing around and, at this stage, you can probably spend your money and time more wisely.
• Google Ads- This is a better option than most of the lead generation portals for a small budget, especially if you combine this strategy with Facebook instead of a general ad in search results.
• Other Websites Ads- Search for websites that have complementary services or products to your offering and consider advertising in them.
• Your WEBSITE - another obvious place; but, are you taking full advantage of your website? Is it optimized for your franchise offering or is it still just directed to your main business? Are you just talking with customers or are you also trying to engage franchise prospects? Will it come up in a search for franchise opportunities in your industry?
• Social Media- (Facebook, Twitter, LinkedIn, and many, many more). First decide the best media suited for your business and then get active!
• Press Releases - This media is nothing new BUT what's revolutionary is how technology has made press releases so effective in creating brand awareness.
• Blogs - Adding a blog can be a great way of building credibility to your offering. However, their effectiveness depends on your type of business. They take time and commitment.
• Newsletters - Today's newsletters are generally electronic reducing the cost of producing and distributing them. They can effectively drive traffic to your website and create awareness of your offerings. You'll need to start building a database, if you don't have one. If you do, have you send an announcement about your new franchise opportunity to your list? Have you asked your customers and others in your database to re-direct the newsletter to people who they believe might be interested in the franchise offer?
• Promoting your business - Remember all you did and hopefully still do to promote your current business? Well, now it's time to do more. Use media relations wisely. For example, can you send media leaders in your neighboring communities invitations to come visit your location and then introduce them to the franchise offering? As new locations open, are you using this important event to cultivate media relations further?  Have you considered hiring a PR/Media Relations expert? They can get you in larger, more widely read publications. The better your business is promoted, the more leads you'll generate for your franchise offering.

In today's challenging economy, many people feel that they have lost a sense of control over their careers. Widespread corporate layoffs and downsizings have made the job market a tenuous environment in which to build a solid future. As a result, a growing percentage of executives are turning to entrepreneurship as a viable alternative.

Indeed, one of the best ways to gain more control over your career is by owning your own business. Your options include: (1) becoming a consultant; (2) starting a business "from scratch;" (3) buying a franchise; and (4) buying a non-franchised business.

Of the people who have elected to pursue the "entrepreneurial option," most have invested in franchises. Franchising has never been more popular, and the range of opportunities has never been broader. Owning a franchise combines the stability of a proven business model with the independence and income potential of self-employment.

Joining with an "established business system" is generally comfortable and familiar for executives who have spent their careers within corporations. It is important to understand, however, that acquiring a franchise is NOT "just buying a job." When you purchase a franchise, you OWN the business.

Such notable publications as Business Week and The New York Times have recently published articles stating that franchising may be the BEST option for mature executives who have been displaced, but who are not ready to retire!

In order to make an intelligent determination as to whether franchise ownership would be right for you, it is important to first gain a basic understanding of the industry and the opportunities it affords.

What is Franchising?

According to the International Franchise Association, the leading professional organization in the industry .....
Franchising is a method of distributing products or services. At least two levels of people are involved in the franchise system: (1) the franchisor, who lends its trademark or trade name and a business system; and (2) the franchisee, who often pays a royalty and an initial fee for the right to do business under the franchisor's name and system. Technically, the contract binding the two parties is the "franchise," but that term is often used to mean the actual business that the franchisee operates.

Franchising is also known as "a continuing relationship in which the franchisor provides a licensed privilege to do business, plus assistance in organizing, training, merchandising and management, in return for a consideration from the franchisee."

History of Franchising

The concept of franchising was born centuries ago. During the Middle Ages, local rulers granted to their subjects rights pertaining to specific activities, such as holding fairs or hunting on the ruler's land. Later, monarchs granted similar rights on a larger scale, such as building roads or brewing ale. The Church granted the same kind of commercial interest when it allowed its tax collectors to retain a portion of what they collected.

In the middle of the 19th century, the Singer Sewing Machine Company began granting franchises for distribution of its sewing machines. By the beginning of the 20th century, the emerging automobile industry and the increased demand for local dealerships was contributing to the growth of franchising.

The modern age of franchising began in earnest around the middle of the 20th century, when Ray Kroc bought the rights to franchise a California drive-in restaurant owned by the McDonald brothers. The success of McDonald's franchises led to explosive growth in Business Format Franchising. The increased standardization of operations now found in most major franchise businesses has played an important role in making franchising an attractive business model for both franchisor and franchisee!

Benefits of Franchising

Franchising is about minimizing risks and maximizing returns. It has often been said that franchising allows entrepreneurs to "be in business for themselves, but not by themselves." A quality franchisor provides proven operating systems, solid research and development, established marketing methods and instant credibility - plus extensive training and support - all of which can reduce risk and build success more rapidly and affordably than in an independent business.

Franchising is also about "the big idea." As an aspiring entrepreneur, you may have all the ability and ambition necessary to succeed - but without a compelling concept to sell, your business will not go very far. As a franchisee, however, you will be in a position to leverage some of the most innovative products and services available in today's marketplace!

Business success requires going through a learning curve for the type of business you're in. With franchising, the franchisor has already gone through that process and is highly motivated to share with you everything that has been learned. Franchises succeed because the franchisor has invested the resources to truly understand the business. There is a proven formula for success ready and waiting to be adopted by the new entrepreneur. How many non-franchise, independent businesses can say that?

And, because a franchise represents a large number of units with established track records, the prospective buyer has access to much more of the data required for sound investment decisions than would be available with a non-franchise start-up. Being able to study the actual performance of identical business entities is invaluable - as is the contact you'll have with other franchisees, who can provide real-world insights into what it takes to succeed in the specific business you've selected.

Of course, what matters most is results. Franchising is by far the most successful entrepreneurial business model - boasting a better than 90% success rate across all industries and sizes. This fact alone makes franchising worth looking at very seriously!

Conclusion

Franchising is certainly not for everyone, and every business model has its "pros and cons." But if you've always yearned to own your own business, can't return to your old career, or just want to escape the "corporate rat race," franchising may offer the solution you've been looking for. Franchising has many appealing and practical elements, and it just might be the best path for you to regain control of your future!

Contact a Franchise Consultant to explore whether franchise ownership could be right for you.

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Permission to Reprint: This article may be reprinted, provided it appears in its entirety with the following attribution: Copyright © 2006, Ford R. Myers and The Franchise Alliance, LLC.

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Choosing the franchise that best suits your entrepreneurial needs and preferences can be challenging with the economic instability and the wide selection of franchise opportunities available in the market today. There are various factors that you need to consider to determine if a certain franchise meets your resources and goals. Your chosen location or franchise area also plays a very significant role in this process. It can make or break your dream of owning and running a successful business. Remember a business' success depends significantly on the market it caters to. So now the question is, how will you know if a franchise will work in a certain location or area?

Franchise Area Considerations

When you decide to acquire a franchise, you need to bear in mind that the characteristics and location are some of the most important factors that contribute to the success of your business. This means that you have to be familiar with the needs of your prospect venture and you need check if the chosen franchise area can accommodate such needs.

The fastest and easiest way to know what brings success to a certain business is to check the customer base and the general population of the area. You need to ask for the income level of the people who will make use of the services or products that you plan to offer. You also need to determine the age group and the total population and density of the franchise area. These factors can have a varying impact depending on the type of franchise you want to buy. Take for example the success rate of a home cleaning business which relies significantly on the high-income levels of every household in that franchise location. This factor may not be a main concern in other industries.

Before you decide to engage on your prospect franchise, you need to be insightful enough to check your success rate in all franchise areas. Carefully study the area characteristics that made one venture successful before you push on establishing your business in other franchise areas or locations. As the saying goes, "always ask, when in doubt."

Assessing a Potential Franchise Area

After determining the factors necessary for a successful franchise, the next thing to do is to assess the prospective area. First, get the basic characteristics of the region. Some of the facts that you should know include the total population and density, which need to meet your sales goals and revenue requirements. In other words, you need to know if your franchise area can gain enough customers.

The next task on the list is to examine the specifics. Check if the factors that made the original franchise successful exist in the area. Getting all the information you need is easy, for you can freely check them in government databases.

Lastly, you have to make projections. Check out the dominant trends in your prospect franchise areas. Determine how fast or slow the market grows and the possibility for it to increase or diminish in the future. See if it's really the best time for you to introduce your franchise business in the proposed area. Use your experience and insight in evaluating these hard statistics and data.

What is a Franchise Area Developer?

It is always an excellent idea to invest in a franchise opportunity with remarkable potential for profit, for you will be able gain the highest benefits possible. If you have the talent in assessing the success of a potential franchise in a particular area, you might want to become a franchise area developer. Franchise area developers handle several franchise areas forming a bigger region. One benefit is that you can instantly raise brand awareness within your covered area. In addition, other franchisees cannot operate in your territory without your permission. Becoming a franchise area developer entails higher risks and responsibilities, but these are compensated with bigger rewards and benefits.

Unless you are a franchise attorney, don't decide to set up your won franchise business without consulting one. No matter how skilled you are at doing online research into the technicalities of starting a franchise; no matter how much advise you have been given by other successful franchisees; and no matter how helpful your franchisor is, you need to hire your own franchise attorney before you sign anything, both when starting your business and during your proprietorship.

Ensuring A Fair Contract

Your franchise agreement is nothing more than a contract; it will spell out in legal terms both your rights and obligations as a franchisee, and those of your franchisor. But even a competent contract attorney may not be qualified to give you're the best legal advice concerning your franchise the way a franchise attorney can.

Franchising lives and dies on the ability of franchisees to accurately and consistently duplicate the product or service of the franchisor. Without that consistency, the franchisor will be unable to create the network of businesses that brands the product or service.

Protection of the product's brand is one of the main focuses of a franchising agreement. A franchise attorney will recognize that contractual clauses protecting the franchisor from an incompetent franchisee are not unfair.

An experienced franchise attorney will know immediately if the terms of the franchising contract are abnormal in any way. And a franchise attorney will be able to tell which parts of a contract might be negotiable. But most importantly, a franchise attorney will be a good source of advice on evaluating the franchise opportunity itself, so that you do not enter a franchise agreement with unrealistic expectations.

If You Need To Get Out

You will also have your franchise attorney be your advocate if, for example, you find that the franchisor misrepresented the earnings potential of your franchise, and you need tot resort to litigation to get out of your franchising deal.

There are many sources [http://www.startfranchisehelp.com/Franchise_Attorney/]

through which you can find a good franchise attorney in your area; the American Bar Association has an online Franchising Forum and you can check the website of the International Franchising Association as well.

The world of franchising is a wonderful opportunity but franchisees should prepare themselves before they buy a franchise. Helpful guides and e-books written by industry leaders can help entrepreneurs to understand the franchising system. Potential franchisees should do thorough research and learn everything they can about franchising.

A Guide to Franchising

Perfect Fit

A franchisee must be the perfect fit for a franchise. The franchisee must have the proper skill sets to succeed in that business. After due diligence, franchisees must decide if a specific franchise is right for them.

Franchise vs. Start-up Business

Statistics show that more franchises succeed than start-up businesses. That encouraging fact, however, should not make an individual choose a franchise without putting considerable thought into the decision. Franchising is filled with systems, processes, and methodologies, and franchisees must be able to follow them.

Big Brands vs. Small Brands

Many entrepreneurs are inclined to set their sights on 'big' brands. Yet big brands are not always the best choice. Actually, many people do not understand the real difference between big and small brands. Of course, big brands are the businesses with the huge physical presence. Yet there are also 'big' brands that most people would not view in that light. Franchisees must educate themselves about every aspect of franchising.

Professional Advice

At some point, every franchisee will need professional advice such as a lawyer and an accountant. Yet franchisees do not need to hire these experts in the initial exploration stage. Franchisees will need them later to check out the details of the deal before any final decisions.

Risk

Franchisees must understand that most franchises meet with success but there is always an element of risk in business. Franchisees can, however, minimize the risk by making an informed decision.

Financing

Obviously, buying a franchise requires financing. Entrepreneurs can obtain that financing from different sources - angel investors (family and friends), commercial lenders, specialty lending institutions, and SBA Loans (US) and SBL Loans (CAN), as well as franchisors.

Entrepreneur

Franchisees must understand which category they fall into as an entrepreneur. There are three types of entrepreneur - the 'people' person, introverted types who prefer processes to customer service, and the team manager.

Franchise Show

Before buying a franchise, individuals should attend a franchise show. People must participate in the show rather than just observe the action. They must ask intelligent questions and learn as much as possible about different franchises. A franchise show is one of the steps in the process of due diligence. As well, every franchisee should have a franchise mentor to explain the basics of franchising.

Passion

Above all, a franchisee must have passion for their business. Actually, the franchisee wants to be certain that the CEO of the franchise has passion for the company. Vision, heart, and passion start at the top and trickle down through the franchise. If the owner does not enjoy the business, the customer will pick up on these negative vibes and go elsewhere. Passion is one of the main keys to success in franchising.

FICTION #1...Franchises succeed because of the quality of their product.
FACT: Can you make a better burger than McDonalds? Of course you can! Franchises are successful because of their business systems...marketing, sales, operations & accounting. Proof? What is the average age of a fast food employee? If a "kid" can run a million dollar business, the systems must be well defined.

FICTION #2...Successful franchises emerge in new industries with no competitors.
FACT: Think about a really successful franchise...thinking outside the bun...how about...

Martinizing...didn't people have their clothes dry cleaned before this franchise?

Dunking Donuts...didn't people eat donuts before Dunkin came along?

Ace hardware...people have been buying tools long before this franchise opened its door. Successful franchises emerge in basic industries with lots of competitors by developing effective systems to dominate the industry. Right now, Fast Food is 95% consolidated, Hair Care is 30% consolidated; Janitorial is 5% consolidated. You can see where the opportunities exist.

FICTION #3...Franchising is all fast food and retail
FACT: There are over 3100 franchise companies in 80 industries. Franchises range from advertising/direct mail to senior care to financial services to home repairs to storage systems. Printing and postal centers, website and social media services, pet services, building services, painting, money stores...and the list goes on.

FICTION #4...Franchises are expensive.
FACT: The "All-In" cost of 30% of franchises is under $100,000. Investing in a franchise is similar to buying a car, a house or a stock. The cost will be based on what you are buying; it can range from $30,000 to many million. The "All-In" costs include the franchise fee; start up costs (marketing, rent, training, etc.) and enough funding to keep the doors open until break even...which can be 6-12 months. About 1/3 of the "All-In" costs will be your own money. With good credit, there are financing options available to cover the rest.

FICTION #5...High return requires a high investment
FACT: The fastest growing segment in franchising are service businesses. They don't require real estate or equipment. They often require less capital; can ramp up quicker and have a faster ROI than brick and mortar businesses. There is no automatic correlation between the cost of a franchise and the financial potential.

FICTION #6...My industry knowledge is the key to success in a franchise
FACT: Only 25% of franchisees stay in the same industry as when they were employed. The franchisor teaches the technology of the business. Some franchisors won't accept franchisees with industry experience because they are less likely to follow the franchisors proven systems; which can contribute to franchisee failure.

What does it take to succeed in a franchise business? Drive, determination, a good franchise system and the right "fit". Specifically, make sure the business maximizes your strengths, passions and skills.

FICTION #7... Franchisees are just buying a job.
FACT: Quality franchisors want their franchisees working "on the business not in the business". The bigger your business, the more money the franchisor earns. Franchising is attractive to many entrepreneurs because it offers many of the advantages of a partnership. "Franchising means being in business for yourself but not by yourself." Whether it's accounting and financing, advertising and public relations, personnel management, purchasing, or inventory control, franchisors are there to provide 'hands on,' one-to-one assistance.

FICTION # 8...Franchise businesses are complex, you wouldn't be able to get into the business yourself.
FACT: For a business to be a franchise, it must be a simple business so that it can be easily replicated time after time. The question is not "Could I do this business myself?" Of course you could. The question is "How will I make MONEY faster?" The good/great franchisees save you time; allowing you to get to the financial finish line quicker.

FICTION # 9...A new business can't be successful during this recession.
FACT: There are many franchise businesses that are not affected by economic sways and some that even thrive in recessionary conditions. Think about growing markets that are driven by demographics and need. For example, 7,000 Americans turn 65 years old every day. Many franchise businesses serving the senior market continue to do well. By 2030 the 65 and over population will double...this is a demographic opportunity! According to USA today, 16 of the 30 corporations that make up the Dow Jones started during a recession.

The biggest MYTH is "Getting a job will insure my financial future".
FACT: According to the Federal Reserve, the average net worth of American families headed by an employee is $352,000. The average net worth of American families headed by a self-employed person is $1.96 million.
Franchising is not for everyone. The question is..."Is Franchising right for YOU?" To find out, you are invited to attend a free educational seminar on December 15th during The Business and Career Expo. You will learn about franchising; meet several top franchise representatives & get your questions answered. Join us at "Franchising 101...Today's Alternative to Corporate Employment".

Deciding to own your own franchise can be a great opportunity and very fulfilling. You will own your own business and have a great chance for success. One of the key contributors of your success will be your franchise contract. If you are new to franchising it can be a little confusing especially since most legal documents are. Your agreement with the franchisor is what will determine the future of your franchise, what you can do, benefits you will receive, and what your franchisor will do for you. Whether you are new to franchising or not it may be beneficial to hire a qualified franchise attorney to help you.

A qualified franchise attorney's help people through the franchise process whether it be a well known franchise or a start up franchise. They deal with the area of law revolving around the right or license that is granted to an individual or group to market a company's goods or services in a particular territory under the company's trademark, trade name, or service mark. These are things you could encounter during the beginning of your franchise career or throughout it. With so many laws it is hard for an individual to know it all, unless they specialize in it as franchise attorney's do.

Your franchisor may offer suggestions for a franchise attorney or where to start, or you may choose to look for one on your own. Either way is acceptable. It is important that you select a qualified franchise attorney for you regardless of how you find them. Some things to consider are followed. You want an attorney that specializes in franchise law. If not they will not be the best suit for what you need. You will also want to find a franchise attorney that has experience. This is a big investment and decision; it is not something you want to chance with an upcoming franchise attorney. You need someone who knows as much as possible and has been practicing for a while. It is advised that you find a franchise attorney that has a concrete knowledge of your states laws for franchising. Ever state has their own laws so it is important that they know what your state's rules are. Also finding a franchise attorney that is an active member of the American Bar Association Forum on Franchising will be something to show they have accreditation and are active with current franchising laws.

You will want someone who knows the laws of franchising as you begin and carry on as a franchisee. They can help you through legal issues that may arise. They can also provide legal council to you as you make decisions for the future of your franchise and you as a franchisee. They may be able to keep you from making costly mistakes either in your initial contract agreement or in maintaining your agreement with the franchisor. Also they may be able to guide you through the correct steps to take if your franchisor is not following their contract agreement with you.

Hiring a qualified franchise attorney is a great decision to make for your franchise and you!

Franchising often grows during economic recessions when newly laid-off employees, early retired individuals and those impacted by corporate downsizing are looking for a means to expand their financial prospects.

After the economic downturn, many of the unemployed began looking at self-employment, including franchise opportunities.

If you are currently researching franchise opportunities, this article will provide you with a guide of what you must know before signing any franchise agreements.

Myth #1 - A Franchise Is Easier To Start Than Other Business Models

While most franchise opportunities provide you with everything you need to get started, no franchise is easy. Hard work and long hours are required, and there are many complicated factors that will determine the success or failure of your franchise.

"There' s a real--and pervasive--misunderstanding about franchising: that a franchise is a color-by-number system where you don't have to be a businessperson to be successful, that a franchise is infallible, and that if you start one, you're guaranteed success." says Mitchell York, author of "Franchise: Freedom or Fantasy?", an essential read for any would be franchisee.

For four decades, the International Franchise Association has insisted that franchises have a much higher success rate than independent small businesses. IFA surveys in the US suggest that 92% of franchise businesses are still operating after 5 years compared to an 80% national small business failure rate. However, there is ample evidence to discredit this assertion.

Take the US franchise research conducted by Timothy Bates, a Wayne State University Economist, which paints a very different picture. After 4 years, only 62% of franchised businesses had survived, while 68% of independent small businesses were still open for business. And independent businesses are far more profitable. Profitability was actually negative, on average, for franchised firms over the four-year period, which brings us to our second point...

Myth #2 - Franchises Are Profitable

Let's say, for example, you invest in a Taco Bell restaurant franchise. Operating only one unit, you'll likely net somewhere between $25,000 and $45,000 at the end of year one - not much money for someone accustomed to earning an executive level salary. The way to make real money with your Taco Bell is to own multiple units. Once you've taken your business to that level you really need to know what you're doing. Do you have the required skills to run a business of 5 to 10 units, hiring and managing the staff and creating the right role for yourself as the owner? These are not items that come standard with your franchise operator's manual!

One of my colleagues was a franchise failure. His initial investment was roughly $150,000. Over the first year or so he invested another $100,000. That's really not atypical. Then the economy collapsed, and so did his business. He ended up saddled with $250,000 in debt.

I always advise that, if you're going to buy a franchise, you really should have plenty of cash reserves. The up front investment to purchase is just the beginning of expenditures. Be patient. Profits will take much longer than you think. The reality is you have to endure losses and setbacks and keep going - don't let them stop you! Most small businesses close due to lack of cash flow -- usually just about the time they are on the brink of success.

Myth #3 - Franchises are a Low Risk Investment

Any savvy investor or entrepreneur knows that risk is always a part of the equation. But the risks of starting a franchise may be much higher than we are led to believe. Perhaps the most important question to ask is how much are you prepared to lose? Your massive investment may also equate to a massive risk.

A franchise can cost you anywhere from $10,000 to literally millions. In addition to the franchise fee you will need to budget for all aspects of set up such as stock, equipment, signage, furniture, fixtures, fittings etc. Your franchiser may also charge you for training and legal fees above your initial investment.

On top of the initial investment and set up fees you will have ongoing franchise fees. I'm unaware of any franchise that does not require ongoing monthly and/or annual fees. This is often masked under different terms, such as royalty payments on sales, advertising or admin fees just to name a few. Make sure you fully understand all your financial obligations, as it may take several years to recoup your significant investment and you should know exactly what you are in for. Make sure you do a detailed financial budget and allow for a contingency in case you aren't profiting as anticipated.

From there, you want to assess several variables to determine whether that investment capital is at risk.

1. What is your maximum financial exposure?

2. Is it a proven business model?

3. Are there risks associated with holding stock or staff contracts?

4. Is your home at risk as security?

5. What external factors can impact your cash flow? For example, is it seasonal? Is it dependent on the economy? Do you have a prime location?

6. What has been the experience of other investors?

7. Does the franchise have a proven track record? Many experts believe that franchise fraud is rampant.

Besides having a reserve of cash, you also need family support and a network of people, from role models to people whose opinion you value and have your best interests in mind.

Be in good physical health. Startups require stamina. You'll be working long hours and often on weekends, which leads to myth #4...

Myth #4 - As a Franchise Owner, You Set Your Own Hours

Yes, this is true. However, not in the sense you may be thinking. Most traditional franchises will require long hours (often 12-15 hour days) as well as the time that goes into managing a staff. Prepare yourself to put in long hours. Your experience and skill in training, supervising and managing staff will play a large role in determining how many hours you work. These types of factors are frequently overlooked with respect to time management. Poor interpersonal communication skills often create miscommunication and staffing problems, which often lead to undue stress and bad health.

Myth #5 - A Franchise is the Best Business Model for the Inexperienced Entrepreneur

On the surface it seems a traditional franchise would be a sound business model for the inexperienced entrepreneur. On the contrary, many franchisees come to realize that they have in reality purchased a very expensive JOB. Their inexperience does not serve them. They find themselves making less money with less freedom, working longer hours with much greater stress. Additionally, they must deal with their staff and may be legally committed to their franchise for an extended period of time without adequate get out clauses.

Inexperienced entrepreneurs would be better served by beginning their new enterprise with a lower risk business model. Online Business Models are more efficient and effective than the traditional brick and mortar model. Many of these types of businesses provide personal coaching and mentoring to succeed. Investment capital is typically a fraction of the cost of a traditional franchise yet provide significantly greater earning potential. The Online Business Model has numerous advantages over traditional brick and mortar franchises:

1. No Space
2. No Staff
3. No Rent
4. No Insurance
5. Low Investment Capital and Far higher Return On Your Investment - ROI
6. Greater Success Track Record for the Average Person/Inexperienced Entrepreneur
7. Quicker Profit Generation. (Profit within your first 90 days often in your first month or even your first week.)
8. Minimal Risk
9. Simplified Setup
10. Time Leverage
11. Can Be Run From Anywhere In The World

In Summary

Franchises and Brick's and Mortar, while still viable, are quietly and quickly being replaced by this simple, new online business model. A new breed of bright entrepreneurs are now finding that this new model is far more lucrative with far less headache and stress. Startup costs are a fraction of what it takes to start a traditional franchise. The Internet is expanding at a record pace, and with it, vast opportunity. By far the largest concern for most would-be Internet entrepreneurs is knowing who to trust or where to start. On the surface, it seems much safer to invest in a recognized brand such as McDonald's or Taco Bell. The reality is that there are a growing number of legitimate, high quality online business models that provide tremendous advantages over brick and mortar businesses. I recommend doing your due diligence on both franchises and online businesses and determine which one is right for you.

If you have a business that has proven to be successful, especially if you have a retail site, chances are that customers have asked you, "Are you a franchise?" And when you say no - that you own the business independently, then they promptly say that they would be interested in buying it if you were franchising.

That is often the first step toward a new franchise business - the "Ah-HA" moment. Unfortunately, that first step often can lead to the end of a successful business. Listening to non-business owners is flattering, but not helpful.

The next thing the flattered business owner does is to seek out information on franchising - sometimes from the Internet, but often through an attorney. (Not particularly from a franchise attorney of course, because at this point the owner doesn't know how much he/she doesn't know.)

What the owner really needs is a dose of reality from a franchise consultant (sometimes called a franchise developer) with integrity. I emphasize "with integrity" because requesting information from an attorney or consultant who stands to make money by saying, "Yes, you should become a franchise..." can start a good business down the wrong (and very expensive) path.

The owner needs to be asked some tough questions from the franchise consultant:

* Are you making money?

* Could your new franchisees earn at least $35-40,000 their first year in business? (If they can't earn enough to help pay their home expenses, they will be unhappy, which hurts or kills future sales of the franchise.)

* Do you have the funds to last for 3-4 years until you have a critical mass of franchisees in place who pay enough royalties to begin covering all your support costs? You're going to spend $100,000 or more in the first year or two to get started franchising - can you afford it?

* Do you want to work hard for at least 4-5 or more years to build a much larger business? * Are you a good leader and team builder?

Franchising is expensive, and many new franchisors fail from lack of funds...

When the answer to all these questions is yes, then the first step the franchise consultant takes is to calculate financial projections to determine whether the company will make money and how much it will cost to put the wheels in motion.

If and when the projections look logical and positive, the franchise consultant begins studying the company's systems and how they can best be duplicated - tightening up the business processes and documenting them into a set of manuals, overseeing the production of a first-class marketing program, and working with the attorney to produce a federal disclosure document.

All along the way, the franchise consultant is teaching. Franchising is a separate venture by itself - an all-new set of sales and support processes. The entire staff of the company needs to be carefully schooled in the legal ramifications of this new and complex business. In the meantime, the consultant helps to establish a new org chart and oversees hiring to take care of both the operational side as well as the franchising roles.

Remember those enthusiastic customers who wanted to buy your franchise? Remember those customers who wandered in and said they wanted to buy the franchise? They had $5,000 in savings and had so little knowledge in business that they couldn't see that you had $150,000 invested in the construction of your site alone! It happens all the time.

Don't let those amateurs push you down the wrong path, and don't let companies who desperately need your business tell you that you definitely SHOULD become a franchise. Find a professional in franchises development with at least 20 years of experience who will tell you the truth and talk about financials before asking you to put your signature on a long-term contract. Franchising is NOT for everyone!

Sometimes, before you begin to look into the information provided by the various franchises you may have an interest in, it can be a good idea to contemplate if franchising itself is right for your lifestyle. There are a great many reasons why someone wouldn't want to be involved in a franchising operation and these are all things that can one day lead to failure. There are also a vast array of positives about franchising, as well. Depending on your personality and the way you do business, these things are all worth thinking about more deeply. Being self motivated and able to follow orders, those are both factors and really reaching a great balance in the way that you run your own franchise and territory will make a world of difference in your own success.

One big plus to going with a franchise is the fact that there will be a reputation behind you. In a sense, the parent franchise lends you their name, and their backing in your own franchise- this is a big thing in your favor as many are swayed by word of mouth. However, in addition to that, the parent franchise also has a proven way of advertising, marketing and generally getting the word out about the new franchises in a given territory, so, you will find that having this definitely works as a benefit. Also, speaking of territory, most parent franchises are pretty strict about not putting too many stores, locations or franchise owners in the same set space- that is to say the territories are often regulated so that there is very little in the way of competition for sales or clients.

The problem with all of this is that there is often royalty payments you will have to pay as time goes on. Every year, in order to continue using this proven name and time tested system, you will continually pay for that privilege. And while you might be paying royalties, not all franchises are going to take care of you as well as others will, so you will have to make sure that you have gone over the disclosures and literature very clearly. If the franchiser is unable to deliver on the things that you were promised- usually there is no way to refund your money and you will be left trying to pick up the pieces.

Having a very realistic view of franchising before you make a choice on which you are going to follow through with is always best. There have been many people who did not educate themselves and realized far too late that a franchise was not for them. On the same token, those who do find the franchise life suits them tend to thrive and become great success stories. It all really depends on your personality, your drive and you own ambition as well as you ability to adapt in most cases, and you'll find that holds true of a lot of things.

Are you an entrepreneur looking to start a business but you just don't have that "great idea" yet? Then franchising might be for you. Franchising offers you the opportunity to join an existing business model and, in many cases, to align with an established brand. Franchising can present tremendous advantages to individuals who do not want to enter the entrepreneurial jungle alone, giving them access to the proven ideas and established resources of others. I work with franchising on a daily basis, and listed below are what I have found to be the top five advantages of franchising.

#1: The Hardest Part is Done
The most difficult part of any business is coming up with a model that works. With franchising, this part is already done for you. Assuming you have done your due diligence and verified the success of the business model, franchising allows you to step into an organization that is already achieving the things you hope to achieve. If you are more of an "execution guy" than an "ideas gal," then a franchise can provide you a wonderful opportunity to profit from someone else's creative vision. Franchising means you don't have to have a great idea; you can borrow someone else's great idea.

#2: The Automobile Is Already Invented, You Can Focus on Learning to Drive
Any good and reasonably established franchise will have systems in place for you to follow. As a franchisee, you do not need to create your own operational systems, training programs, or supply chains. The franchisor and other franchisees have taken the hits for you. You are paying a franchise fee and royalties for, among other things, other people's trial and error.

#3: You Can Open a McDonald's... or a McDowell's
In a crowded marketplace, the power of aligning oneself with a strong brand cannot be understated. Take note of John Amos' character in Coming to America who tried to align himself (illegally) with the strength of the McDonald's brand by creating a knock-off restaurant called McDowell's. Of course, most brand names do not carry the cachet of the McDonald's name. However, if the franchise has a decent geographic footprint (or, if new, growth rate), ask yourself would you rather enter your marketplace as Sylvan Learning Center or Jim's Tutoring Pros?

You chose Jim's - congratulations! By the way, I wanted to let you know that a Sylvan Learning Center is going to open across the street from you three months after you open and that there will be six more Sylvan Learning Centers with a Co-op doing television and radio advertising in your area within two years. Still feeling confident about the Jim's Tutoring thing?

#4: Economies of Scale and The Resource Advantage
When a franchisor creates a new ad campaign, it does so for 300 or 700 or 3,500 stores. Franchisors are able to spend a lot more on creative because they are amortizing that cost across a whole network. Compare an ad for McDonald's with your local restaurant's cable ad. Enough said. The bigger the franchise, the more it can invest in top flight marketing creative, real estate analysis, customer research, and product research, to name a few. The list is virtually endless.

Like military wars, business wars are as much about resources as about strategy and tactics. By aligning yourself with an established franchise, you are able as a small business owner to reap the benefits of large company economies of scale. Here are a few examples to demonstrate how important the resource advantage can be.

• Supply Chain - I recently met with a small business owner who was ordering a product online. I was ordering the same product but was getting a bulk discount negotiated through one of my franchisors - she was paying over triple what I was for the same product.
• National and Co-Op Marketing - Face it, Jim's Tutoring Pros will never be able to afford a full page ad in Working Mother magazine (nor would it be a wise investment for a local store such as Jim's) - Sylvan should be able to. Many franchises also form regional Co-ops, particularly in major markets, that give them the ability to afford ad campaigns and raise brand awareness past what an individual store can do
• Research and Development - Large companies can afford R&D that can have a direct impact on market share and unit level profitability. For instance, market research, ad testing, product testing, and retail placement testing are just a handful of the many research areas where the resource advantage plays out. Also, the sheer data generated by a network of stores provides business intelligence to which sole proprietors could never have access.

#5: Two plus Two Equals Nine, The Network Effect
In many franchises, the network of franchisees and area/regional developers can be as powerful a support mechanism as the franchisor itself. In franchise networks (or geographic areas within franchise networks) where franchisees work together and help each other out, you can learn valuable lessons and best practices from people who are on the ground and have faced the same challenges and opportunities you will face when you open your franchise. Network best practices may be one of the most powerful tools that give franchise operators a competitive advantage over their non-franchised counterparts, and one of the advantages that people outside franchising fail to realize the power of.

As you can see, franchising provides some strong advantages. However, one must always bear in mind that, while the above benefits are present in most strong systems, not all franchise opportunities possess the above characteristics in equal amounts (or even at all). In my opinion, the above advantages give franchisees a huge competitive advantage over sole proprietors in like businesses. Franchising, when it is done right, cannot be beat.

How do you know if it's being done right? Start by doing your due diligence. If you are interested in learning more about franchising and its potential disadvantages, please see the post on Potential Franchising Disadvantages at my blog.

Copyright 2011. IntenseFence Management Solutions, LLC.

Many people are searching for ways they can best meet their financial goals. Some of the popular Google searches are on things such as, "what are the best franchise opportunities and can I be successful with them?" Some of the most popular and best franchise opportunities are often considered to be with companies such as Subway, McDonald's, Ace Hardware, or Pizza Hut. But even when you know what the top franchises are, you must ask yourself whether this business model will be able to best help you to meet your financial goals. Can you truly be successful by buying and running a franchise?

Top Important Qualities to Look for Even in the Best Franchise Opportunities:

1 - Cost: The significant cost you will be faced with for any franchise is one of the most important things you will need to be aware of, and usually the main factor to deter most people from moving forward with the purchase. The initial start-up cost of a franchise can range from $250,000 to millions of dollars, and then of course you will have to also weigh in the cost it will take to run the franchise and pay employees

2 - Time: Another thing to consider when researching the best franchise opportunities is the amount of time it will take to run the business. Most people seem to want to become their own boss so they can escape the confines of the bricks-and-mortar businesses or 9-to-5 office jobs. Those sorts of jobs seem to take up too much time and keep you away from family or travel time. So be aware that a franchise is no different and if you are the one purchasing and running the franchise, you will likely have even less free time on your hands than before!

3 - Compensation: This may be the number one thing to look at in your franchise research. Find how long it will take the average person to turn a profit in the franchise opportunities you are considering. With most franchises, it tends to take at least two to five years if not longer for the average person to be able to make back their initial investment.

So, when looking at franchises, it is clear to see that there are some really important things to consider in your research for whether or not a franchise is the right choice as a financial investment. Alternately, it is also important to be aware that many people have found some excellent business alternatives that have the potential for creating even greater success than the franchise business model. One such industry you may want to take a close look at would be the Online Marketing Industry.

Online marketing tends to cost significantly less than a franchise, at often less than a couple thousand dollars as a typical start-up fee. An online business will also provide you with a much more flexible schedule, allowing you the freedom to work from home and spend time with your family and the ability to travel. And in addition to that, an online business also provides you with the potential for unlimited income when you know how to market effectively, as you will now have access to a market that spans the globe instead of whichever local market or territory is covered by your particular franchise. And you can make back your initial investment in a matter of days or weeks instead of what would likely take years with typical franchises. And in this economy, that may be the biggest drawing card yet, since people need to make money now and not next year!

So, no matter which type of business you decide to go forward with, it is extremely important to do your homework and be open-minded but also realistic. Even the best franchise opportunities have their drawbacks, but all of the best online marketing businesses also require true dedication and work, as well. There is never a free ride to success. You will always have to do your due diligence and stay positive and focused in order to see results. There are never any guarantees in life, so if success is what you're after, then you will have to be the one to make sure that is what you get!

If you own a franchise business, then there are a few taxes that you are need to pay to make sure that your business runs smoothly and you don't have to face any legal / tax complications in the future.

All the corporations that are supposed to file the Annual Franchise Taxes. The new franchise tax and fee law introduced in the year 2004 requires all the franchise businesses to pay a State Authority franchise tax and another franchise fee to the Secretary of the State every year before April 15.

The franchise taxes are of two kinds: the organization taxes and the doing business taxes. The organization taxes are the taxes that have to be paid by franchises to exist as a corporation. On the other hand, the doing business taxes are ones that have to be paid by the corporations for having the privilege of doing business within the limits of the taxing authorities.

The franchise taxes and the fees were paid to the Secretary of States, in the past, at the time of filing the annual report. With the new franchise tax law, the taxes are to be filed with the Department of Revenue after filling up the tax form K-150, and the franchise fee is to be paid to the Secretary of States along with the annual report.

There are a few things that you are supposed to keep in mind, even if your corporation is not a franchise, you are still supposed to follow the franchise tax. In this case, the franchise tax will be considered a business tax based upon the corporation's assets. All corporations are supposed to file the franchise tax. In case no tax is due, the corporation has to give its information to the respective department.

The franchise taxes have to be paid by the corporations including the domestic as well as foreign. They also include partnerships, some owners, and even Limited Liability Companies (LLC). "Corporation" also includes the trusts, joint stock companies, and other associations and organizations that operate for profits, have a capital stock, or shares, and special privileges.

The franchise taxes are supposed to be filed a year in advance depending upon the assets of the enterprise as of the first day of the taxable period. Let us take an example: If a new business enterprise incorporates in April 20, 2004, with its accounting period ending on December 31, 2004, then, it is supposed to file its first franchise tax return on the 15th day of the 4th month from the time the taxable period begins.

In this way, the date that will be due for the initial franchise tax return for that entity will be August 15, 2004, depending upon the qualification date and the assets it had at the time of its incorporation.

The business entities that have a net worth of $100,000 or more in a state should pay a franchise tax of 0.125% of their total net worth to the State Department of Revenue along with their taxpayer's balance sheet. Various credit balances are deducted from the franchise tax to calculate the amount owed. If the calculated amount of tax is found to be less than $100, then, your corporation is not required to pay the franchise tax for that period. Yet, filing is still important.

(Remember talk to your legal and accounting advisor)

Learn more about owning a franchise today : http://www.hjventures.com/franchise/franchise-glossary.html

Are you thinking about franchising your business? Franchising is a way to create rapid business growth, but it won't happen without a solid plan to sell franchises.

Selling Franchises Begins With Quality! Before you can expect anyone to buy into a franchise of your operation, you must make sure that your business offers the highest quality product or service possible. Entrepreneurs will want to buy your franchise for one reason - to make money. They will be looking for a quality product or service to offer.

You will also need quality personnel and a quality place of business. There is every chance that the entrepreneur interested in your franchise will first come to you as a customer. If he receives quality products and services and your place of business is always neat and clean, he will have a favorable impression of your franchise operation.

Finding Your Market! Your next step after making sure you have a quality operation to offer is to sell franchises. First, you'll need to determine a price for your franchise. Your price should cover all of your costs in providing the franchise, as well as a profit. You must also determine the royalty amount you will earn from the sales each franchise makes. Typically, royalties run between five and ten percent of gross sales, but each franchise is different.

The next thing you need to do in order to sell franchises is determine your market. A good place to start is with employees who are already familiar with your business. Does your business have a manager or other senior employee who might be interested in owning a business? Some of your senior staff might make their wishes known to you at the time you tell them of your plan to sell franchises. If they have not, approach them with the idea. Let them know why you think they would be a prime candidate for business ownership.

You will also want to advertise your franchising opportunity. There are several publications and websites that will allow you to reach entrepreneurs seeking franchises. You can find them easily by doing an online search. One that offers free information on all types of franchises is pay me franchises dot com.

Putting Together Your Plan And Selling Franchises! You will need to work with investors, lawyers and bankers in order to put together a plan for selling franchises of your business. As a business person, you may already have a relationship with a banker and a lawyer. Approach these people first and let them know of your plan to franchise your business. They can prove very helpful to you and keep you from making costly mistakes.

You will also need to have many systems in place for making your franchises run smoothly. These systems include the daily operation of each franchise and the training and advancement of employees. These systems will be a part of your franchise plan and will need to be accessible to all franchisees so they will know how to operate the business. Selling franchises won't be easy, but with a plan it can be profitable. And remember, the best kept secret of the 21st century is franchising.

The basic rule when thinking of owning any kind of business is the chances for success favor buying an existing business. There are pluses and minuses for either choice, but the statistics for success favor an existing business. The reasons become very obvious with a little study on the part of a potential buyer.

The cost difference

Is there a cost difference between the new franchise and buying an operating franchise? There can be quite a difference both ways depending on the financials of the existing franchise. If the business has good numbers and is showing a decent profit, it will be worth more than a franchise that is opened and started at a new location. The customer base has been started and, depending on the length of time the franchise has existed, the base could be significant and almost guarantee continued success.

Location

The location can contribute greatly to the cost, as location of a business that depends on walk-by or drive-by traffic is valuable. A new franchise may not have the same numbers of people going by. This lack of traffic will show up in sales over time. An easy way to view this principle is to think about a two-week fair. If it is well attended, the merchants will do better than if there is a low attendance. The same is true of a corner business with or without traffic. The low traffic will mean lower sales. These facts are a proven difference between two businesses that depend on people stopping by the business.

Why is the owner selling?

This element of a sale of an existing business is critical when talking of price for the business. If the owner is burned out and tired of the day-to-day running of the franchise, it may be possible to buy a good business at a bargain price. Some owners will sacrifice some money just to get rid of the business. If they are really ready to leave, this can work in the favor of the buyer. Money talks and a cash offer with no strings may be all it takes to pick up a good business at a bargain price.

An estate sale or a sale that is brought on by divorce may also offer the potential to buy the business for a very good price in relation to what it is really worth. Hire an expert business evaluator and see what value they come up with compared to the asking price. If there is a significant difference in your favor and you can afford the price, seriously consider making the deal.

Existing traffic and road changes

Make it a point to see if there are likely to be any street changes or surrounding business changes that will affect the traffic that supports the business. This factor alone can make a huge difference in considering the purchase or not. Do not get surprised in this way as you can see the business die due to lack of traffic. This is not something you want to learn about after the purchase.

If the business is in a shopping center, make sure that the anchor stores are staying, as they supply the traffic for all of the businesses in the center. An active grocery store is always a good traffic builder for the other businesses in the shopping center.

If the business is in a rented property, make sure that the lease can be assumed or negotiated with favorable terms. If the business includes a building, make sure that you have the building inspected for possible repairs that may be needed. Again do not get surprised after the purchase.

Can all existing franchises be bought?

The answer to this question is it depends on the buy-back agreement the owner has with the franchiser. It may also depend on a clause called the right of first refusal. This clause gives the franchiser the right to meet the offer of any buyer.

So the answer is it depends on the agreement the old owner has in his contract of purchase when the purchase was made with the franchise company. These terms can have a direct effect

With these possible restrictions, the franchise owner may want to sell, but the contract roadblocks may be too difficult to overcome except by selling it back to the franchise company. The reason for these buyback contract restrictions is the franchise company wants to control who owns a franchise Their contract rules may be so restrictive that the old owner has no choice.

Can a franchise contract be negotiated?

In most cases there is very little that the franchise company will negotiate since they do not want to lose control or cause problems with their other franchise owners. The more successful the franchise is, the less negotiating room there is likely to be in the purchase contract. They just do not have to make concessions to potential owners, as they can get whatever they need without doing any negotiating.

If there were some room for negotiating, a potential buyer would be wise to see what the other owners of franchises were able to finalize in their contracts. At least you know what was available in the past between the buyers and the franchise people. Knowing what was possible is absolutely an advantage to the negotiation of contracts between the buyer and the franchise company. If the deal comes down to something that you could not live with, walk away and try finding a different business venue. After all there are hundreds of franchises available to the people who want to own a business. Ask your questions and listen closely to the answers. If an agreement is drawn up, make sure you have it looked at by a good business attorney. Do not assume any thing that is not in writing and in detail if it is important to your decision.

Conclusions

All business purchases should be studied and broken down into a plus-and-minus analysis. When the list is down to a few, then a clear-eyed comparison should be made between the business opportunities. Ask yourself: do you have enough capital to make sure you are successful? Do you need to have a stellar beginning that may not happen? Is your business plan realistic or filled with best-case scenarios? If there are too many ifs in your plan, then it better be looked at again and revised.

Analysis of an existing business and ways to make it grow or become more efficient are critical to continued success. Getting answers to all of your questions and having the answers verified are steps that need to be taken seriously. Assumptions are for fools and lazy buyers. Do not be either, as it will cost you later. There are never any dumb questions. There are just dummies who do not ask the questions. Buying a business right is hard work. It is just part of the pathway to success for you as a businessperson. Verification of all answers is the secret to buying a business and keeping surprises to a minimum.

The wood renewal business is one such business, which not only provides services for necessity but also for beautification of wooden items. People often tend to modify or beautify their traditional wooden closets and cabinets rather than purchasing new ones. So, this business will always remain in demand. This N-Hance Franchise Review will help you decide whether it is the right opportunity for you.

Overview: N-Hance Franchise is a franchise, which is into the wood renewal business. They have unique processes by which they can refinish wood cabinets, traditional wood floors and many other products, which are made of wood. Their processes have helped them achieve some amazing results at a fractional cost and time. N-Hance Franchises have helped their customers in beautifying their wooden items, which was beyond their expectations. They have also helped their clients by saving their many thousands of dollars in this process. This review states some points about the N-Hance Franchise. If you are interested starting a wood restoration franchise, then this review can give you a fair idea about it.

Background: N-Hance Franchise of Wood Renewal services started offering its franchise service in the year 2003. Since then, its franchise locations have rapidly shot up to around 200 franchises. There are around 180 franchises, which are operating the United States itself. You can say that N-Hance Franchise is one of the largest in the world in the area of wood improvement retailer.

Advantages of the N-Hance Franchise: It is still a relatively new franchise in the market. You can choose from available exclusive locations nationwide with about 100 markets still available. This franchise is rapidly growing in the wood refinishing market. Some of the facts which for which you can opt for N-Hance Franchise are listed below:

Your customers will enjoy beautiful and almost new looking wood cabinets and floors, which will be very different from the rest of the services provided in the market.

N-Hance has some unique processes, which can help you in achieving incredible results at a fractional typical wood refinishing cost. There will be no mess, dust or odour involved as almost all the jobs get over in a day's time.

All these benefits come at a very low cost. This means that your customer will be pleased and happy with your services. They may also refer you to their acquaintances that may need a wood renewal solution. This is definitely one of the advantages, which can help in your business growth.

Start-up Fees and Franchise Cost:

Total Investment: $22,500-$37,500

Royalty Fee: $220-660/mo

Term of Agreement: 5 years

Initial Franchise Fee: N/A

Advertising Fee: Nil

Business Operations: It is very easy to run N-Hance Franchise. Some of the points, which are included in the operation of the N-Hance Franchise are-

· There is no need to obtain a big area or office space to run your franchise. You can operate your N-Hance Franchise business from the convenience of your home. So, you do not have to invest money for a work space as such.

· You can hire 2-3 employees to run your franchised unit.

· Absentee franchise ownership is allowed.

As always, when making a business decision it is important to do your due diligence and research. While the franchise will help with the systems necessary for operations, the success of your business will always be in accordance with the effort and energy one puts into business development

Checking Out Franchises For Sale

Every year, Entrepreneur magazine names its top franchises for sale, gathered up into a list called the "Franchise 500." By referring to this list, prospective franchise owners can determine the top franchise for sale in any number of categories-the best fast-food franchise, the best auto service franchise, the best do-it-yourself picture framing franchise, and so on. This publication also names the 10 best franchises for sale regardless of the industry they are in, and it is this list that offers the most coveted ranking of all. The "next hottest franchise concept" certainly has a chance to advance in the standings. But year after year, the same companies continue to dominate this list, mainly because they have superb brand recognition, a solid financial base, highly satisfied franchisees committed to excellence, and products or services that have stood the test of time. As Entrepreneur sees it, here are the top 10 franchise companies for 2009.

1. Subway
The top company on this list has gained a reputation for offering fresh, healthy food at very reasonable prices. They also come up with some very innovative national marketing campaigns to keep the name "fresh" in the public's eye. Subway began franchising in 1974 and has more than 21,000 franchises in the United States. The company charges a franchise fee of $15,000, with ongoing royalties of eight percent based on gross annual sales. One's total investment will run from between $78,000 and $238,000. Subway has franchises for sale in nearly every U.S. state.

2. McDonald's
Ray Kroc took a California hamburger joint owned by two brothers and turned it into the world's largest fast-food restaurant chain. Over the years, McDonald's has been an innovator from the aspects of both service and menu items, inventing such concepts as the kids' meal and drink tops with pre-punched access holes. The company charges a franchise fee of $45,000, with ongoing royalties of 12.5 percent based on gross annual sales. One's total investment will run from between $950,000 and $1.8 million. McDonald's has a franchise for sale to residents of every U.S. state, plus worldwide opportunities exist as well.

3. Liberty Tax Service
With the tax deadline of April 15 looming over the heads of U.S. citizens every year, more and more taxpayers realize that it pays to hire an outside expert to help them complete their filings. The company started as Jackson Hewitt Tax Service in 1972 (and began franchising a year later) and changed its name after buying out another tax business in Canada. The company charges a franchise fee of $40,000, with variable ongoing royalties based on gross annual sales. One's total investment will run from between $56,000 and $70,000. Liberty Tax Service has franchises for sale to anyone living in the U.S. or Canada.

4. Sonic Drive-In Restaurants
This company started as a root beer stand in 1954 in Shawnee, Oklahoma, jumping into the franchise business five years later. Today there are close to 3,000 Sonic Drive-In franchises across the country. The company charges a franchise fee of $45,000, with ongoing royalties ranging from two percent to five percent, based on gross annual sales. One's total investment will run from between $1.2 million and $3.2 million. Sonic currently seeks out residents of Canada, New Zealand and Australia, offering exclusive territories in its franchise for sale.

5. InterContinental Hotels Group
The flagship property in this massive chain is the self-named InterContinental, which include some of the most prestigious hotels in such world capitals as London, Paris, Vienna, Cairo, Nairobi, and many others. This hotel conglomerate also includes such familiar brand names as Holiday Inn, Crown Plaza, Staybridge, and Candlewood. There are more than 2,600 franchises in the U.S. alone, as well as another 800-plus in foreign countries. Franchise fees and total investments will vary widely, since every property is unique. The company charges an ongoing royalty of five percent based on gross annual sales. InterContinental has franchises for sale in Oregon as well as assorted worldwide locations.

6. Ace Hardware Corp.
The neighborhood hardware store is alive and well in the guise of Ace, a national chain that prides itself on hometown values and helpful personnel who can tell you the best way to paint a door or repair a fence. The company began in 1924 and became a franchise operation in 1976. There are currently more than 4,200 U.S. franchises. The company charges an application fee of $5,000, and one's total investment will run from between $400,000 and $1.1 million. Ace Hardware has franchise for sale opportunities in all U.S. states.

7. Pizza Hut
In 1957, when this pizza chain started business as a single restaurant in Wichita, Kansas, no one would have suspected that it would grow into the largest pizza restaurant chain in the world. Today there are nearly 10,000 franchises in existence, including "express" and kiosk locations that expose Pizza Hut products to more people than ever. The company charges a franchise fee of $25,000, with ongoing royalties of six percent based on gross annual sales. One's total investment will run from between $317,000 and $2.9 million. Pizza Hut has franchises for sale in Oregon as well as assorted worldwide locations.

8. The UPS Store / Mail Boxes Etc.
Mail Boxes Etc. started in 1980 as a competitor to the U.S. Mail and has since expanded to offer all kinds of services that include the sale of packing materials, copying and printing, mailbox rentals, and shipments of darned near anything to anybody who has a permanent address. Re-branded as The UPS Store - although it ships by other carriers as well - the company charges a franchise fee of $30,000, with ongoing royalties of five percent based on gross annual sales. One's total investment will run from between $155,000 and $295,000. The UPS Store has franchise for sale opportunities in all U.S. states, plus various locations worldwide.

9. Circle K
This convenience store chain was founded in 1951 in El Paso, Texas. They waited until 1995 to begin franchising, but since then Circle K has seen its U.S. franchises grow to more than 450. Surprisingly there are nearly 3,700 franchises overseas. The company charges a franchise fee of $15,000, with ongoing royalties of four percent based on gross annual sales. One's total investment will run from between $161,000 and $1.4 million. In a nationwide expansion mode, Circle K has franchises for sale across the United States as well as in assorted worldwide locations.

10. Papa John's International
This pizza chain got its start in 1985 in Jeffersonville, Indiana. Papa John's has more than 2,100 U.S. franchises and close to 500 on international soil. The company charges a franchise fee of $25,000, with ongoing royalties of five percent based on gross annual sales. One's total investment will run from between $135,000 and $490,000. Papa John's has franchise for sale opportunities in all U.S. states.

When one thinks of a franchise business, no doubt the most successful fast food chains come to mind, like McDonald's and Burger King. But did you know that these franchises take at least one million dollars just to open one? And it's not enough to have one million dollars to get the restaurant open, but the franchiser must also have excess money at his/her disposal to ensure six months of payroll and rent before they can get the approval to purchase the franchise.

It is important to know that there are a wide variety of franchise businesses that exist in many different industries. You may assume that the startup costs for these franchises are equally as steep as the McDonald's and Burger King's, however most opportunities can be had for considerably less money than you would imagine.

If you're considering opening a franchise, it is the franchisee's responsibility to find the location for doing business and present it to the franchiser, along with a business success plan. Not many McDonald's or Burger Kings are unsuccessful, and the main reason for that is because the parent corporations have a strong commitment to the success of their franchisers.

If you are a person who wants to own your own business, a franchise opportunity can make a great deal of sense. Since the franchisee does a lot of the legwork and research to ensure the success of the franchiser, and since the franchisee provides advertising and a success plan, the chances of you - the franchiser - succeeding are improved greatly.

Some of the fastest growing franchise industries, other than fast food restaurants, are pest control, home services, lawn care, interior decorating, window cleaning, and pet care. Pet care has been one of the fastest growing areas within the franchise community, with franchises available in pet grooming, pet supplies and pet kenneling. Home services such as gardening, maintenance and cleaning are also great franchise opportunities.

Remember, the franchisee does not make any money unless you are successful with the franchise. They have every intention of giving you what you need to be successful, so they, in turn, can make money as well. Furthermore, franchisees have a model that is proven and well developed. Follow the franchisee's model and work hard to develop your client base.

The franchising sector is full of opportunities, but you must show the initiative to find the right industry that suits your interests and skills. Get in touch with a franchise manager or franchise broker, who will connect you to a franchise opportunity that meets your budget, your skills and your lifestyle. With the support of a reputable franchisee, you will be on your way to running a successful franchise and becoming a successful business owner.