Franchises Under 40K

What is a Franchise?

Looking to get into business, backed by the support of a franchisor whilst retaining the freedom of business ownership? Franchising is one of several ways of getting into business, and for many, it’s a decision they haven’t looked back from.

Franchising is a method of business expansion. Unlike other types of business expansion where new units are launched at company expense, the expense in the case of franchising falls mostly on the franchisee – the person buying the rights to trade. Not to be seen as a disadvantage, becoming a business owner through franchising means your investment will be less risky because you won’t be putting your money into a solo startup of your own, which would otherwise be very risky especially if you’ve no business experience. Instead, you’ll be granted access to a proven business model, established brand name, and access to the training and support of the franchisor. Who wouldn’t want to go into business ownership with all of that!

Many franchises can be invested in for less than £40,000, and generally the average franchise investment is around this figure so you should expect to see a great range of opportunities in this franchise directory.

A franchise is a business which has been launched under the franchising framework. Some big name UK franchises include Dial a Dog Wash, ChipsAway, Oven Clean and Tubz Vending – all of these can be started for less than £40K! (correct as of 2023).

A Supportive Sector

If the £40,000 figure sounds a lot, you’ll be pleased to know many banks and businesses favour franchising as a more successful route to business ownership. As a result, they’re often able to lend up to 70% of the investment, enabling you to set aside more of your own funds as working capital.

Despite not being government regulated, franchising is very well supported in the UK. The British Franchise Association is made up of a wide range of members and partners, from franchises to franchise consultants, lawyers and lenders who are all eager to help the sector.

From franchise consultants and associations, right down to the franchisor themselves, franchising is considerably well supported. But it is important that you do your due diligence and explore the market and its demand before jumping into business ownership.

What will I get when I invest in a Franchise Under £40,000?

The initial investment of £40,000 or less will cover everything you need to get the business off the ground. Generally that will include training, support and launch marketing, plus whatever you need to start handling your first clients. For an oven cleaning business, that might include chemicals and vehicle signwriting. For a travel franchise, it would include prominence online plus any necessary customer management software.

Are Franchises under £40,000 Profitable?

Generally speaking, all types of franchises are profitable. For a business to get to the point of franchising, the business model needs to have already demonstrated resilience in the market. The profitability of a business is very much up to its owner.

To gauge whether a franchise under £40k is profitable you should carry out due diligence. Explore the market in your own area and understand whether the demand is enough to enable a business to be profitable. Understand the competition and learn whether the demand is already met. Luckily, franchise businesses benefit from increased buying power, greater marketing (through an already recognised brand) and sizeable territories, meaning regardless of competition, the business should still be successful provided there is demand. But profitability of a franchise will strong depend on its owner. How much time can you commit? The more you put in, the more you’ll get out of owning a franchise.

Ultimately, when you’ve built up the business, you’ll be able to sell it as a franchise resale.