You will probably have to pay a regular fee to the franchisor.
This may be a percentage of your profits, so the more successful you are, the more you'll pay out to your parent company.
Getting started
Franchises can cost anything from a few thousand pounds for a mobile cleaning business to hundreds of thousands of pounds for a fast food franchise.
Before you buy a franchise do your homework, write a business plan and carry out your own market research on your potential customers.
Speak to your bank. They will probably have a person who specialises in advising would-be franchisees.
You should look into the background of the franchisor.
Find out how long the business been running, and how many franchises it has.
Also check how successful its franchisees have been - have many failed?
You should also check into the support and training that you will receive. And look closely at the financial projections for your franchise.
Make sure you are aware of the terms of your agreement, specifically how long you will have the franchise for, whether you'll have an option to renew it and what happens if you need to sell the business.
Never sign up without getting the agreement vetted by a lawyer.
Make sure you speak to other franchisees - those suggested by the company, and others that you find by yourself.
Ideally try to speak to a franchisee whose business failed.
Other types of franchise
There are several different types of franchise.
As well as complete packages, there are franchises like car dealerships where you might have a contract to sell a product without trading under the franchise name.
There are also franchises where self-employed distributors sell goods on behalf of manufacturers. They make commission on the number of items they sell, and employ other distributors to work for them.
People to speak to
The British Franchise Association publishes an information pack and a full list of its members.
If your franchisor isn't a member, find out why not.
The BFA can also advise you on franchise exhibitions, which are a good place to see a variety of franchises.
For more information give them a call on 01491 578049 or take a look at their website www.british-franchise.org.uk.
Also look on the Business Link website at www.businesslink.gov.uk for more general information on starting a business.
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