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What Is Franchising?

You have probably heard the term ‘franchise’ after ‘Harry Potter’, ‘Star Wars’ or ‘Marvel’, These are multimedia franchises. Whilst we’re not the association for hollywood films, we do think what we do is pretty special!

The bfa is the trade association for business format franchising in the UK. We truly believe business format franchising transforms lives. It provides people with the opportunity to do what they love, build a successful career and most importantly, do it to suit their own desired lifestyle.

Business Format Franchising: The granting of a license by one person (the franchisor) to another (the franchisee), which entitles the franchisee to trade under the trademark/trade name of the franchisor and to make use of an entire package, comprising all the elements necessary to establish a previously untrained person in the business and to run it with continual assistance on a predetermined basis. Both parties will sign a franchise agreement which is a legally binding contract, outlining obligations and responsibilities and usually lasts for 5 years. The franchisee pays an initial fee to get started and then an ongoing monthly fee which is usually a fixed amount or a percentage of turnover. In return, the owner of the brand (the franchisor), provides everything they need to start and run their business successfully. Usually, they will deliver all the initial training, tools, equipment and systems required and provide ongoing support through refresher training, business reviews and business planning.

The fundamental elements of a business format franchise are piloting to prove the idea works and can be replicated; initial training to franchisees in the operation of the business; the ownership of the business by the franchisee and the capital investment they will have to make.

The provision of ongoing support is a vital element. Whilst the franchisee is the owner of the business, it is important to bear in mind that it is the franchisor’s system and brand that the franchisee is operating under. An ongoing dialogue between franchisor and franchisee is crucial therefore in contributing to the success of each individual franchise unit and consequently, the franchise network.

So, Who’s Who?

The franchisor is someone who has a proven and established business. They believe the business can be successfully replicated across other locations.
The franchisee is an individual who wants to start a business and wants to do that using a proven Business Format Franchise.

Below shows the lifecycle of a Business Format Franchise, showing the franchisee and franchisor commitments throughout the contract.

Watch our overview video to find out more

This video explains in depth how franchising works and provides some wonderful examples of franchise brands that are growing well using the franchising model and features some franchisees that are excelling too!

Why Franchise?

Franchising provides an exceptional opportunity to self-employment. here are just a few of the elements that make the industry so special and unique:

In Business For Yourself – Not By Yourself!

You will be supported by a head office team who want you to succeed and are surrounded by a network of like-minded individuals who are all going through the same thing.

A Proven Business Mode

bfa Member franchisors have evidenced they have a proven business model which can be successfully replicated in another location. Whilst success cannot be guaranteed, a franchise provides a level of reassurance, showing the business model does work.

A Lower Failure Rate

Franchising has a significantly lower failure rate vs when going into business alone. on average, over 40% of standalone businesses fail vs less than 5% of franchisee businesses. Your franchisor has already made the mistakes, so you don’t have to!

An Opportunity For Everyone

Franchising is an exciting and diverse industry. As an association, we have been delighted to welcome more women and younger entrepreneurs to the industry over the recent years. Whether you are looking for a flexible, part-time opportunity or looking to grow your business empire, franchising could be your key.

Fuel Your Passion

From restaurants and cafes to pet care, education and business coaching, the franchise industry provides self-employment opportunities across an extensive range of sectors. Franchising could enable you to turn your passion into your career.

Invest in your future

Franchising is an investment in your future, with many franchisees in the industry handing their business over to family members or selling their business for a substantial profit when they are ready to retire or move on to pastures new.

In Business For Yourself - Not By Yourself!
You will be supported by a head office team who want you to succeed and are surrounded by a network of like-minded individuals who are all going through the same thing.
A Proven Business Mode
bfa Member franchisors have evidenced they have a proven business model which can be successfully replicated in another location. Whilst success cannot be guaranteed, a franchise provides a level of reassurance, showing the business model does work.
A Lower Failure Rate
Franchising has a significantly lower failure rate vs when going into business alone. on average, over 40% of standalone businesses fail vs less than 5% of franchisee businesses. Your franchisor has already made the mistakes, so you don’t have to!
An Opportunity For Everyone
Franchising is an exciting and diverse industry. As an association, we have been delighted to welcome more women and younger entrepreneurs to the industry over the recent years. Whether you are looking for a flexible, part-time opportunity or looking to grow your business empire, franchising could be your key.
Invest in your future
Franchising is an investment in your future, with many franchisees in the industry handing their business over to family members or selling their business for a substantial profit when they are ready to retire or move on to pastures new.
Fuel Your Passion
From restaurants and cafes to pet care, education and business coaching, the franchise industry provides self-employment opportunities across an extensive range of sectors. Franchising could enable you to turn your passion into your career.

The motivations for investing in a franchise are many and varied. From the desire to escape the 9 to 5 routine, be your own boss, improve career prospects and lifestyle, as well as spend more time with family and have a more flexible routine, franchising is seen as a very realistic option for many people who want to start their own business.

But don’t just take it from us, see what our members have to say!

Is Franchising Right For You?

Franchisees:

Franchising provides a wealth of opportunities and possibilities, but it is essential you understand your obligations as a franchisee, acknowledging that buying a franchise is not buying a job. running your own business, even as a supported franchisee requires determination, tenacity, and dedication. Our ‘Buy A Franchise’ Seminar can help you to understand the ins and outs of franchising to help you on your journey and you can explore your perfect match in our franchisor member directory.

Franchisors:

Already have an established business? Congratulations! Building a successful business is a true display of creativity and commitment and something to be incredibly proud of. If you are looking to expand, franchising your business could be the perfect solution for you. Again, it is critical you understand your obligations as a franchisor and to assess whether your business model is appropriate for business format franchising.

Our ‘Franchise Your Business’ Seminar will help you understand franchising, your responsibilities as a franchisor and the opportunities it could bring. Alternatively, one of our franchise support mangers will be happy to support you – get in touch here.

Key Considerations:

Franchisee

Are they a bfa Member?
bfa Membership shows a commitment to ethical franchising and sustainable business practises. bfa Members adhere to the European Code of Ethics, providing reassurance that the brand has a proven business model and commitment to supporting their franchise network.

How does the franchisor support their network?
What ongoing training and business support does the franchisor provide once you are a franchisee? How do they support you to achieve your business goals?

How do existing franchisees feel?
Speak to existing franchisees in the network through both your own due diligence and recommendations from your franchisor. Franchisors should always be happy for you to speak to their network before making any decisions.

Is it a good financial fit?
Are you able to afford the initial franchise fee and working capital? When are you likely to make a profit and will the profit you generate be enough for the lifestyle you are realistically looking to achieve?

Does it fuel your fire?
The beauty of franchising is that it can enable you to do something you love. Running your own business takes hard work, so make sure it’s in an industry you have a passion for and want to be a part of.

Read more about the considerations you should make and the questions you should ask your franchisor here.

Franchisor

Can Your Business Model Be Franchised?
Your business must be successful and replicable to allow potential franchisees to operate the business profitably elsewhere. It needs to be a business that can be taught to others for them to replicate with your training, systems and branding etc.

Cost Considerations
Although expansion through franchising can be cheaper than organic business growth, there are still cost implications to carefully consider. there are up-front costs such as writing a franchise agreement, producing a detailed operations manual, adapting the structure of the business, marketing, franchisee recruitment and professional guidance.

Expertise
The bfa has a network of accredited professional affiliate partners, including banks, accountants, solicitors, media partners, and franchise consultants who can support you to set up your business for franchising. Franchising your business can feel overwhelming initially, but guidance from industry experts can ease this for you and help you to develop an ethical and sustainable franchise.

Commitment
Many individuals join a franchise network for the ongoing support given to them throughout their journey as a business owner. As the franchisor you must be committed to helping them succeed, providing ongoing business support, training and national-level marketing to develop the brand.

Future Proofing
Franchising your business can be a real investment in your future, as like any other business, it can be sold to generate a profit for your retirement or future investments. With that in mind, developing strong business foundations is essential and something our industry affiliates are able to support you with from the beginning.

Our Role In Franchising:

As your trusted partner in franchising, we are here to support you throughout your journey in franchising. From helping you to decide if it’s the right choice for you, to supporting you to promote your franchise nationally and lobbying for the industry across Europe, we are your trusted partner. You can read more about us and what we do here.

bfa Monthly Franchise Insights

Free franchising webinar

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