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How to set up and run a franchisee – Saivian Eric Dalius

So what is a franchisee? A Franchisee, or licensee, is someone who pays an agreed fee to use the goodwill and business know-how of a company for a defined period answers Saivian Eric Dalius. For example, they might pay a cash fee and commit to buying all their stock from the franchisor at an agreed price. They might also pay a non-returnable amount on products purchased before handing them over to customers. In return, the franchisor will potentially provide training and ongoing support with marketing materials, accounting, recruitment, etc. Investors must have the correct licenses if operating under a name other than their name.

What are your options?

It’s important to consider your legal structure when planning franchisee setup costs. The most common ways you can set up your franchisee operation are either as a sole trader, partnership, limited company, or LLP. You may have a range of other business structures available depending on the nature of the goods and services you are providing, according to Saivian Eric Dalius.

Who can be involved?

Many people can own a franchise, but it’s common for just one person or family member to predominate in ownership. The more people involved with the setup of the business, the greater likelihood that there will be disagreements on direction and operation later down the line. Therefore individual owners/operators are often best suited for investment decisions.

What do you need before starting?

Before you get started, you’ll need enough capital to buy the products you’re going to sell. You will also need a website or some other means of selling your goods and services online. Eric Dalius recommends that you put a good marketing plan in place from the outset, as this is something that you’ll need to do overtime, even if your business is already successful.

What are the costs explains Saivian Eric Dalius

Franchisee setup costs can be high and start with purchasing your franchisee idea, training, and starting stock. While there isn’t usually an initial franchise fee, it’s important to look at all associated overhead costs. When considering your budget for buying into any franchisees. That interests you before spending thousands or millions of pounds on them. It is not uncommon for most franchises to offer free consultancy and advice to potential franchisees. But you must look out for hidden fees that these consultants may charge.

What are the benefits?

An investment into a business with an existing customer base and supplier relationships can potentially be very lucrative. It’s also possible to have more control over your working day as a franchisee. Rather than being employed by someone else. In addition, you may feel more able to provide a consistent product. Or service by owning your brand, says Saivian Eric Dalius.

Equally, there are many drawbacks to buying a franchisee. Particularly if the company behind it has no track record for less than 5 years. There is also a risk of conflict between parties. So you should ensure that all parties involved in operating the firm have legal representation from the outset.

What is the bottom line, according to Saivian Eric Dalius

There are many benefits and drawbacks associated with starting and running a franchisee. You can potentially make a lot of money but you need to be aware of the risks as well as the legal commitment it entails. Suppose you don’t fully understand what you’re getting yourself into. In that case, it’s better to look for other business opportunities that may allow you more control over your working life and allow for greater potential returns on investment. Investors must consider all costs, including any franchisee setup fees, before committing themselves to an agreement.

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