Learn the Cost of a Franchise Business – Start a Franchise

When you start a franchise business understand that there are many costs involved. Do not let some of the start up cost deter you from having a business of your own. Having your own franchise business can be very rewarding so make sure that you investigate all the costs that are involved before you begin. There can be a simple call such as attorney fees for looking over the agreement before you make it finalized. In some cases this can cost you a couple of thousands of dollars and you also will have a fee to set up your LLC Corporation.

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Other costs that can be involved in setting up a franchise business is the amount you will have to pay back when borrowing money to buy a franchise. It can be well worth whatever it costs in the beginning because you are done and make your dreams come true and owning and operating your very own franchise.

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There are also franchise fees that you will have to pay to the franchisor but if you are doing enough business will not make a difference. You have to look at purchasing this type of business and compare it to a traditional business. In some cases the costs of opening a business that does not have name recognition can be less. But you are going to have to spend enough money to gain some kind of name brand that people feel comfortable with.

Remember that opening a franchise business can be a great way that you can fulfill your dreams. Before you begin however you need to remember there are costs involved in opening this type of business. You are to have the initial startup fees by hiring an attorney and having them review your agreement. They will also have to set up your corporation or legal entity before you begin. It is important that you sit down and compare all the fees that are involved with opening a franchise so that you know exactly what to look forward to when you go into business.

Bryan Burbank
http://www.articlesbase.com/business-opportunities-articles/learn-the-cost-of-a-franchise-business-start-a-franchise-1047569.html

Post Author: mark

2 thoughts on “Learn the Cost of a Franchise Business – Start a Franchise

    Happy

    (May 13, 2010 - 1:31 am)

    Small Business Owners How did you start?
    I’ve always wanted to own a small business and I have a lot of questions. So if you don’t mind I would like to pick your brain for a minute.I have a degree in business but I know there are things to learn that the classroom does not always teach you. Im really looking for your story on how you started your business if you don’t mind sharing. So my questions are as follows but please feel free to rant on if you wish

    How did you get into the business that you are in?
    Did you choose to re-invent the wheel and open your own store or a franchise? Are you a sole proprietor or a partnership….if a partnership of 2 did you split it 50 50?
    How did you acquire the funds to open your business, did you receive help from SBA?
    If you don’t mind, how old were you when you started your business and how much were your start-up costs?
    Where did you live when you first started and did you have a second source of income to help you in the beginning? Did you write a business plan? How many employees do you have and how did you acquire them? Are any of them family members and how did that change your relationship if any? How do you handle disagreements between family members in the business?

    That’s all I can think of for now but Im sure you get the idea! Thanks!

    Calypso

    (May 13, 2010 - 6:33 am)

    Hi, I own a clothing store 🙂 Its 450 square feet in a cute little tourist town. My target customers are 16-30 year old girls I am 26 and have had the store for 3 years now. I do not have a degree. I have worked in small businesses for years and have been the manager of a shop similar to mine. (how I learned about all the behind the scenes stuff)

    I always loved working in small shops, and I love clothing, the business that I own, was an exsisting business for 20 years. I worked there for 7 years on and off, and bought the business, then relocated it (the rent on the original location had increased obscenely)
    Moving the business basically made it just like opening a brand new business, as opposed to if I had stayed in the original location.
    For the business I am in I don’t think having a partner would be a good idea. I think there are too many areas for conflict, and most people I know who have had partnerships in small shops like mine end up dissolving the partnership eventually. There is always one person who ends up working harder, or person feels like they would work harder. I would never have a partner 🙂 My friend opened a coffee shop with a partner and the other guy totally fell apart. Since they have both invested 50% when the other guy wanted out my friend had to liquidate the whole shop, because he had to give his friend 50% of the businesses’ assets.
    I am an S- Corporation, which protects my personal assets.
    It cost about $30,000.oo just to open my doors. Part of that was what I paid for the business (basically I just paid for the inventory, fixtures, and the rights to the name) I relocated, so I had to renovate my new space, as well as order more inventory, and of course there is rent, insurance, setting up my CC machine, phone, electric, etc.

    I had to move back home to my parents house when I first opened, I got an apartment about 6 months later. I live very very very frugally. Since the economy has tanked it has devastated the town that I am in (over 20 businesses have closed in the past year) so times are pretty tough.
    I wouldn’t open a business unless I had financial backers, a VERY large savings account, family that you could borrow money from, or another job. It takes a few years to profit.

    When I first opened I had an employee who worked 3 days a week, and I worked the rest of the hours in the shop. I got my employees by putting up a help wanted sign. Don’t hire friends, it can be very tough if a friend slacks on the job and you have to fire them or criticize them. Its not worth it. (I learned this the hard way!)
    Due to the tough times I now have my mom working for me instead. Whenever there is a disagreement between us I remind her that it is my store, and I am the boss, and that it isn’t personal, it is BUSINESS. She needs an occasional reminder, but it works out pretty well. It has actually brought us closer.

    I love having my own business but it is very tough .When people say things like "oh it must be so fun to have your own shop" or they think my job is easy I tell them that my job isn’t like other people’s jobs. I don’t just work when I am physically in the shop. I don’t just have a list of things to do and rules that I have to obey from a boss. I am on call 24/7. If I get sick, I can’t just call out, I loose money if I can’t come in and open the store because that means I have to PAY someone else to be there. I work more on holidays. I never have a weekend off. I have a lot of paperwork I have to be on top of. I have to make tough decisions about what to order to sell in my store. If I make the wrong decision I loose money. There is no one to make me go to work on time, or not close early, or not take $ from the register. It is all on me, I have to be a self motivator. (not always so easy!) Sometimes I don’t get paid at the end of the week because the store didn’t make enough money, so I can’t plan ahead for myself financially.

    There is more of course, these are just the ones always on the tip off my tongue. However if you work very well by yourself (I have always preferred to work alone) are able to self motivate and have dreams and vision and are very very responsible owning your own business can be very rewarding. I love what I sell and I love my customers and I really love having complete creative control.

    I personally wouldn’t want to own a franchise because there would be too many rules that I would have to follow. For me owning a business means that I make all the rules myself (except for the legal ones of course!) I love what I do, and for me it is worth all the fear and head aches!

    What type of business are you interested in opening? My advise to you would be find a business that is somewhat similar, or along the same lines and try working in that business for a while. Build a relationship with the owner of that business and they can tell you more then any collage course!
    References :
    Small Business Owner

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