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Expert Advice

Why invest in a low-cost franchise

Why invest in a low-cost franchise

A low-cost franchise does not mean low returns. In fact, buying a business on a budget can be the smartest business decision you will ever make.

Razzamataz Theatre Schools is a low-cost franchise, but the financial potential is enormous. We ask for a £9,995 investment to cover the franchise fee, plus your marketing and working capital. The potential return can be in the region of circa £300,000 plus annual turnover with a circa 70% gross profit. A recent sale of a Razzamataz Theatre school was £200,000, not a bad return for a franchise fee that initially cost under £10,000! 

Affordability

It is no surprise that potential franchisees are keen to find out more about affordable franchises. Research for the British Franchise Association Royal Bank of Scotland Franchise Landscape Report 2018 showed that the franchise fee was the number one financial consideration among 85% of those setting up a franchise.

Living costs

At Razzamataz, one of the first things we will ask you is about your expectations of making money in the first year. We won’t take on people that have the franchise fee but who have not considered the capital to keep them going until the business starts to make enough profit to pay them a wage. As a reputable franchisor, we must know that you are able to live and pay your bills while building the business. 

It’s not a job, it’s a business

Many franchisees can fund a low-cost franchise easily, but the same care and consideration should go into your decision to invest as if it were tens of thousands of pounds. Crucially, you are not buying a job, you are creating a thriving business. With that comes responsibility and commitment and you need to be prepared to put the time and effort into making it successful.

Getting funding

Another advantage of a low-cost franchise is that it is easier to arrange funding. Razzamataz Theatre Schools has an excellent reputation with lenders, and we receive 70-80% funding from most high street banks, meaning that franchisees only fund circa £3-6,000 of their own cash.

Low cost but high commitment

Just because the franchise fee is less expensive than others, it does not mean that any less work will be required. As a lower-cost franchise, we have many franchisees that combine running their school with other part time work commitments or looking after family. However, we know from experience that the first few years will need 100% commitment to get the school off the ground and to build the foundations for strong business growth. Razzamataz offers a huge amount of flexibility enabling people to create the life/work balance of their choosing but this must be combined with a strong work ethic.

Growth potential

A low-cost franchisee fee should not mean limited growth options. The Razzamataz business model is ideal for people that want to start small and then grow over the years. This has enabled many franchisees to transition out of their full or part-time job and concentrate on Razzamataz. Debbi Ledwith launched Razzamataz Newbury in 2015, alongside continuing her teaching work and being a single mum to three children. From day one, she fell in love with her business, and this year Debbi has been able to transition from being a teacher to being a full-time entrepreneur at Razzamataz.

Value for money

No low-cost franchise should be cutting back on training and support. At Razzamataz, we only succeed if our franchisees are successful. One to one training, support calls, mentor sessions, webinars and Zooms with industry experts, regional meetings and an annual Conference, are just some of the ways in which we support franchisees. “The Razzamataz model is a reputable brand offering amazing support from all at Head Office as well as the network of franchisees,” says Matty Aitchison-Rayson, franchisee Razzamataz West Cumbria. “There is always someone to speak to and you never feel like you are in business alone. Head Office work incredibly hard to make it as easy as possible for Principals to be successful.”

Join our team

We are looking for dynamic partners to own a Razzamataz Theatre School. If you are looking to make a difference in your local community to the lives of young people and you have a passion for performing arts, we would love to hear from you.

Re-sale opportunities

Occasionally franchise territories come up for re-sale due to a change in the franchisees’ personal circumstances or simply because they have decided to sell their asset and reap the rewards of their hard work. These re-sale schools very rarely stay on the market for long, so if you are interested, don’t delay in contacting us. Re-sale schools in:

  • High Wycombe, Buckinghamshire

If you would like to find out more about our ambitious growth plans and be part of multi-award winning Razzamataz Theatre Schools network, drop Charlotte a line from our friendly Head Office team to book on to one of our virtual Discovery Dens.

Razzamataz Theatre Schools LTD

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