People are increasingly seeking ways to make money from home, but are hesitant to invest the required time and money, since it takes a lot of business savvy to create an enterprise “from scratch” and the failure rate is quite high.
Enter the world of franchising--a pick of many entrepreneurs anxious to start their own business but who desire the safety net of a proven brand. Franchises include replicated physical “brick-and-mortar” operations like fast food restaurants, gyms, gas stations, and convenience stores.
Basically, this is how it works. A franchisor is a supplier or parent company who allows an operator (franchisee) to use the supplier's trademark and distribute the supplier's goods in exchange for a hefty investment and ongoing royalty fees.
In a 2016 Franchise Direct survey of 389 prospective franchisees, out of 28 possible selections a whopping 36 percent said they were interested in home-based franchises. When asked the primary reason they were interested in franchising, 39 percent respondents selected “I want to be my own boss, but don’t want to come up with my own business idea.”
Most entrepreneurs don’t have boatloads of extra money lying around. When asked how much they were planning to spend on starting a franchise, 59 percent said they wanted to spend below $100,000.
Investing in a franchise
In researching franchise opportunities by investment requirement, one of the least expensive I came across was one with an initial franchise fee set at $49,500. When other investment costs were tallied, the total investment came to $62,500. Added to that amount was a royalty fee of 8 percent of revenue that had to be figured into the mix.
You may be surprised to learn that a franchise is just a temporary business investment without any long-term benefits. Yes—with a franchise, you merely get to rent or lease an opportunity or license, not purchase a business for ownership purposes. A franchise is classified as a “wasting asset” which means it declines in value (depreciates) as time passes. Examples of wasting assets include fixed assets such as property or security that eventually have little or no residual value.
According to a report on food franchising by Franchise Business Review, half of food franchises earn profits of less than $50,000 a year and the average profit for all restaurants rings up to around $82,000. That doesn't sound too formidable, until you consider the initial investment can run from $500,000 to $1 million or more.
A similar business model without the high investment cost
You want to make great money. You want to build something of your own, yet be part of a team. You also seek the financial advantages of doing business with a respected company without mortgaging your future to do it. Look no further because there is an answer: a virtual health food franchise. Stay tuned for forthcoming information or contact me if you'd like to learn more!
Debbie Neumayer has dedicated her life to researching and writing about nutrition and natural medicine. She enjoys sharing this information and helping people discover paths to greater health and wealth.