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Are there particular franchise formats or sectors that are more likely to guarantee a six-figure income?
Alan Wilkinson writes:
There are three main types of franchise. An owner-operator will work in the business themselves, and usually complete all or most of the jobs within the business themselves. With careful consideration and due diligence in the decision to buy into the brand, this type of franchise will typically give the franchisee the earnings level they are looking for, while operating it themselves.
The second type of franchise is a management franchise. This is where the franchisee employs staff in their business, and typically takes the role of manager themselves. A management franchise is typically larger, and therefore has more potential to generate higher revenues.
Then there is an investment franchise, where an investor may have multiple units, or indeed multiple brands in their portfolio. By definition, this is therefore likely to be the largest type of business, and therefore more likely to generate the highest revenue.
The industry sector can also play a big part in the revenue potential for a franchisee. For example, a single food and beverage outlet in an area with good footfall and the right demographic of customer may generate higher revenue than a multi-van management franchise.
No franchisor, irrespective of sector, should ever ‘guarantee’ revenue. They should make available average figures, or even figures from their most successful units, so long as the data is clearly identified as ‘average’ or ‘best’.
There are many examples of franchise businesses that generate six-figure income levels. However, within any one brand, there will likely be some franchisees that achieve this, and some that do not. A prospective franchisee should do their research, and decide if the brand they are looking to join has the potential to earn them the level of income that they want or need.
Alan Wilkinson is head of franchise development at The Franchising Centre and has been in franchising for over 25 years.
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