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What are the advantages of investing in a franchise that’s been operating for less than 12 months?
The answer to this will depend very much on the particular business and the route it has taken to becoming a franchisor. Provided that the original business from which the franchise has grown can be shown to have been successful and its owners have taken professional advice on the structure from British Franchise Association accredited consultants and on the franchise agreement from similarly recognised lawyers, you could be in at the start of something that will be a great success story. An added advantage from your point of view will be if the franchised business itself has already been accepted as a provisional member of the bfa, thus demonstrating further intention to do things properly. In such circumstances the franchisor will often be looking for pilot franchisees to help test how well franchising works for the business and there may well be reductions or indeed an absence of upfront fees in return for your risk taking and cooperation in developing the system. You will also get the opportunity to mould things your way and forever be in closer contact with the franchisor than will future franchisees as the size of the network grows.If none of the above criteria can be demonstrated however, you would do better to keep your money in your pocket and look for something more secure. Franchises that have been developed by ‘do it yourself’ methods or with non bfa accredited so called advisers are simply accidents waiting to happen.
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