Do You Need a Premises to Open a Franchise?

Image: Not all franchise opportunities require a premises. Shop fitting costs are often factored into the investment so you know how much the business is going to cost before you start.

When you relish the thought of becoming a business owner, one of the hurdles to getting started can be the costs involved. Along with the franchise fee and investment, property costs can also be a factor. When you become a business owner, you may need a suitable premises to get started.

There are many types of businesses available as franchise opportunities which require having a suitable premises in which to run the business. But on the other hand, there are many opportunities which don’t require you to have a premises.

Getting Into Business Ownership with a Franchise

Franchising is one of a number of routes into self employment. There are some fantastic franchise brands in the UK, and unlike starting up a business from scratch, franchising enables you to be a part of something bigger. Franchising is a method of brand growth where the brand owner grants individuals (and other businesses) the rights to trade as their brand. The franchisee invests to open up the business under the franchisor’s brand.

• This benefits the franchisor because they themselves don’t have to fund the growth of the brand, the franchisee (you) cover the launch costs. Therefore the franchisor can open more units quicker, without having to fund growth themselves.
• This benefits you, the franchisee, because you own the business. Using the brand name for an agreed, renewable length of time. Just like starting up a business, your money goes into getting the business up and trading. But you also get support, training and everything you need – rather than finding suppliers yourself.

Franchises carry brand recognition and reputation. Unlike starting an individual business, franchises garner immediate brand recognition due to the existence of other units across the country. This initiates a brand recognition and customers can associate positively, choosing you over competitors, franchised or otherwise.

You Don’t Always Need a Shop or Office to Open a Franchise

There are many franchises which are either home or van based, not requiring you to have a dedicated premises to run the business. Franchises like EZ Drive Car Hire and Live Like Loyalty can be run from home, saving on start up costs.

Even though the franchisor will factor in premises costs like leasehold rent costs into the profit potential, both highstreet and home based franchises can be equally as profitable. With a franchise, you’re entering a market that is in demand. Regardless of which option you choose, home, van and highstreet businesses should all be as equally as profitable. Ultimately what you can make out of a business, depends on the input by you.

Generally, home and van based franchises have lower overheads compared to high street businesses. You cut out many of the costs associated with running a highstreet business, such as the shop fitting and fewer utility costs. Initial startup costs of a home or van franchise can often be cheaper too, van franchises usually cost less than £35K to get up and running, while home based working franchises can be launched from less than half of that.

You’ll Be Supported if Investing in a Franchise Which Requires a Dedicated Premises

So what if you’re looking to invest in a franchise on the highstreet, one that requires a dedicated office or shop, such as a fast food business?

When you invest in a franchise, the money you pay not only goes into equipment and brand, you also receive full training and support. That support often helps you find a suitable premises, agree on a suitable price with the owner, either as a freehold purchase or as leasehold agreement, and ongoing utility access.

Freehold is where you own the property and land indefinitely, while leasehold is where you use the premises under a rental agreement from the owner. Both options are viable for franchises and the franchisor can help you with choosing the right location for your business.

Franchisors will take the ongoing premises costs into consideration when determining profits and losses of a franchise model.

Interested in Becoming a Business Owner? Discover Franchise UK Opportunities

Whether you’re looking to run a shop or highstreet business, or a home or van based business, don’t let the franchise fee put you off. Just like starting up a business from scratch, the investment gets your business up and running to the best possible start. The franchisor is experienced in helping entrepreneurs like you get into business ownership with their brand. Could you be a part of their success? Browse franchise UK based opportunities at Franchise Planet.