About Franchising for Ex-Police Officers

Is franchising your next step?

Tom Endean, British Franchise Association

Franchising has attracted the attention of many over the past two years. The tough economic climate has highlighted its strengths and shown that there is a more secure way to start your own business. Its formula of a locally owned and run enterprise, driven by a small business owner, with branding, economies of scale and support from the wider network, gives the business a far better chance of success. However, this is only the case if it is done well.

A good franchise will offer you a proven business format with the initial and continuing support that you will need. Your business will work under the brand established by your franchisor using the business system they have developed and proven in the marketplace. You will pay an initial fee to set up using the brand and the proven business format. You will then pay continuing fees for ongoing support that will help you operate and allow you to build the business and eventually build a capital asset that you can sell.

These ongoing costs, which provide the ongoing support, are one of the major reasons behind the success of franchising. The franchisor has already gone through the pain of finding out what works and what doesn't. They have invested in the systems and are now willing to teach you how to replicate it. However, don't think you can pick and choose which parts of the systems you want to pick up. It is very much all or nothing. However, if you are paying for a proven system, why wouldn't you follow it?

What are the advantages?

• About 90% of all franchisees reported profitability over the last 12 months.

• The business format is proven.

• You have the opportunity to build your capital as well as your earnings.

• It is your business and you are the owner manager, providing you follow the system, you decide what goes.

• The major banks are very supportive of good franchising.

What are the disadvantages?

• Running any business is hard work, demanding the highest level of personal and family commitment.

• You make a financial investment. No investment can be guaranteed, especially when it depends on your own efforts as well as your franchisor and the market place.

• You buy into a proven business system for its benefits but you also take on responsibility for following it.

Some key steps to follow to identify a good franchise

Membership of the bfa: The bfa accredits franchisors using a stringent set of criteria based on a code of business practice and the European Code of Ethics for Franchising. All members are listed on the bfa's website.

Investment level: Levels of investment range from smaller amounts, that you may already have available, to larger amounts that you may need a bank loan for. There are three major banks that the bfa recognise as specialists in franchising, providing dedicated franchise teams.

Research:

• Speak to existing franchisees: you want an extensive list to choose from. Speak to both successful and the less successful franchisees to give you a much more rounded view.

• Understand the business: make sure you understand all the business operations and what is involved on a daily basis.

• The people: Don't underestimate the importance of meeting the people involved at their office and finding out who you would be in contact with and what their experience in franchising is.

• Success rates: ask for success rates of other franchisees. There may be failures, but the important aspect is to understand why.

• Recruitment: If they don't seem to be picky about who they recruit, walk away. You want to see that they are stringent in their process.

• Professional advice: There are a host of professional advisors accredited by the bfa that specialise in franchising, including consultants, accountants, solicitors, banks and even media. They are invaluable in making sure that you're taking the right steps and don't miss any vital information.

Visit the bfa's website at www.thebfa.org for objective advice and access to numerous educational resources.

For full day educational seminars visit www.thebfa.org/franchise-seminars