Profitable franchises with little investment. What is the real payback period of the franchise - we analyze different options Franchise with a quick payback

Starting your own business is not an easy and very risky process. A lot depends, first of all, on the personal qualities of a novice businessman, as well as on the economic situation in the market. That is why many entrepreneurs start their business with franchising.

What it is like and whether it is worth buying a franchise - let's try to figure it out, relying on real experience and feedback on franchises of people who took the risk and got down to business.

What is franchising

This is a type of cooperation in which one party (franchisor) transfers the second (franchisee) the right to sell its goods and services or manufacture products under the franchisor's trademark.

The franchisee pays a lump-sum fee and royalties to the business owner, who, in turn, fully controls the activities of the partner, dictates his conditions to him, allows him to use his technologies and developments, development, and in some cases supplies goods for sale.

In our country, the history of franchising began only in the late 80s and early 90s with the company for the production and sale of ice cream "". Abroad, the experience of buying franchises goes back more than one decade. This is one of the most common types of business expansion for promising companies.

In Russia, the most successful directions in franchising are:

sale of food products;
organization of catering outlets;
sale of consumer goods: inexpensive brands of clothing and footwear, furniture, building materials, etc .;
provision of services: medical, legal, entertainment, etc.

Franchising of manufacturing companies is much less successful and in demand, the development of which requires knowledge of complex technological processes, requires additional costs for materials and other production resources, as well as the availability of qualified personnel.

What is the advantage of buying a franchise

Franchising has many advantages, especially for people who are taking their first steps in business.

Let's take a closer look at the main advantages of a franchise:

When buying a franchise, you do not need to worry about the promotion of your business - you are acquiring a ready-made brand with its own history, promoted name, and target audience.
You do not need to think about where to purchase raw materials for the production of products, what technologies to use, how to draw up a business plan, what equipment will be required to open a trading floor, a medical center, etc.
The franchisor is actively involved in doing business, providing consulting, marketing and training services.
You do not need to spend money on advertising - the advertising campaign is carried out by the franchisor who is directly interested in the promotion of the company's products.
When you buy, you pay a strictly defined amount, which is calculated in the most accurate way by economists who are well versed in business processes.
You do not need to look for partners for your business - the franchisor provides you with the opportunity to cooperate with your partners.

What difficulties a franchise owner can expect

Like any phenomenon, franchising has its drawbacks. Before embarking on a free voyage, you need to learn about all the pitfalls that await you on the way. Reviews of the franchise from our entrepreneurs are very contradictory, and there are also grounds for negative experiences.

One of the main obstacles can be a lack of start-up capital for a down payment. Oftentimes, a lump sum is more expensive than investing in your own business. In addition, the matter is not limited to the payment of a lump-sum contribution - you have to pay royalties on a regular basis.

Another drawback that some entrepreneurs point out in their reviews of the franchise stems, oddly enough, from the merits. Constant control by the business owner can limit the independence of the franchisee. This is due to the strict terms of the contract, requiring full compliance with all requirements for the quality of goods and services.

Regardless of how you are doing, it will be impossible to go beyond the business plan. For ambitious entrepreneurs, this can be a big problem.

The reputation of your business will depend on what the franchisor has. Therefore, when choosing a company, you need to try to get complete information about it before agreeing to buy a franchise or choosing a world famous company such as or.

“If you don’t have any experience in business, and you still don’t have enough life, your pocket is empty, but ambitions do not allow you to sleep peacefully at night, then feel free to choose franchising. I took a chance, bought a franchise fromSubway, and six months later, it opened a second outlet, and then several restaurants in neighboring cities.Subwayperfectly helps to cope with the first difficulties, directs and very strictly controls all processes. This is the best choice for those who are used to working and taking a responsible attitude to business. You gain invaluable experience, and in a few months you will be able to recoup all costs ".

Franchises in the field of children's leisure, as well as sports or musical-aesthetic education are very popular. Sports and dance club franchises allow many people to realize their dreams not only about business, but also to show their creative, pedagogical and intellectual abilities.

However, there are also negative opinions. Very often this is due to the fact that people buy franchises from companies about which little is known in the region. Because of this, it is much more difficult to attract customers, it requires competent advertising campaigns, a lot also depends on the person who owns the business:

“My friend bought goods from a very famous brand in this country abroad. She liked the quality of the clothes and the price. She decided to buy their franchise and open a store in her town. However, no one here heard anything about such a brand and, despite the good product, the support of the management company, the business did not go. Therefore, you should not get involved with unknown brands - it is better to follow the beaten track and buy a franchise from a well-known profitable company ".

It is no secret that organizing your business "from scratch" is costly and involves significant risks. According to statistics, about 50% of small businesses do not last even two years on the market. The use of a well-known brand for start-up entrepreneurs significantly reduces risks and allows you to bypass most of the "pitfalls", which is why the direction of franchising is becoming more and more popular. Franchising is the organization of business relationships for starting and running a business. The subject of such an agreement is a franchise - the right to open a business under a well-known brand for a certain fee using technologies and production secrets.

In this article, I will discuss whether a newbie in the business world should buy a franchise business. And also you can see my video on the topic of whether it is profitable to buy a franchise now:

Franchise- the most affordable and fast enough method of business development for novice businessmen, requiring minimal investment. Below we will talk about the benefits that come with buying a business model under a well-known brand name:

Debugged business processes. Smart people are known to learn from the mistakes of others. Asking the question: "Is it worth buying a franchise?" you need to take into account the fact that when buying a ready-made business model, you will learn about the most common mistakes that the franchisor or other franchisees have made, and can easily get around them.
Business plan. All financial indicators of the business are transferred to you: approximate investment, payback period, net profit, average check. Thanks to these indicators, you will be able to analyze the course of your business and find problem areas, which, if necessary, will help the franchisor to fix it.
Brand recognition. Buying a franchise for a newbie involves using a well-known brand that has already won the trust of customers. This factor minimizes advertising costs, since well-known brands practically do not need it, and also recognition will reduce the time to profit and recoup the funds spent at the launch stage.
Training and support. A decent franchisor, along with the right to use his trademark, gives you all the theoretical and practical subtleties and nuances of the business. Often the transfer of these skills takes place in the form of a training program or course, which makes it possible to assimilate information as efficiently, easily and quickly as possible.
Support. The franchisor's team assumes support in all areas: you can ask your account managers if you have any questions about the business, and, if necessary, the head office will provide you with legal protection, help from IT specialists to correct technical problems or designers for the production of promotional products.
Quick start. By using the streamlined business processes handed over to you, you can reduce the start-up period to a minimum: from two weeks to one month! The launch mechanisms are already known, the management company team will always come to the rescue - what else is needed for a successful launch?

If you need help in selecting a profitable franchise or auditing a selected one - contact me, I have extensive experience in franchising, I will be happy to help!

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What problems can you face

It would seem that the answer to the question: "Is it worth buying a franchise?" obviously positive, however, one cannot but mention the negative aspects of this business model.

Restrictions and penalties. The activities of a franchisee entrepreneur are strictly regulated by the terms of the contract, so there is no "space for creativity" in this business. Moreover, when fixing the fact of violation of the conditions of the company that owns the brand, a strict system of penalties is envisaged.
Lump-sum payment. One-time payment for joining the network and the right to work under a well-known trademark. The financial factor is important for aspiring businessmen, and some franchises are expensive.
Royalty payments. Regular payments for the right to use the brand. Despite the fact that this is an additional financial burden on the franchisee, the transferred knowledge and technology base can quickly recoup these expenses.
Property of the franchisor. When buying a franchise, it is worthwhile to understand that upon termination of the contract, the return of all commercial information transferred to you at the conclusion of the contract is provided, since this is the property of the franchisor. You will not be able to work in this area of business, although you have already studied all the nuances and technical processes. The main advantages and possible problems that you need to familiarize yourself with before deciding whether a newbie should buy a franchise, I also recently highlighted in a video on my channel. I think it will be interesting for you to familiarize yourself with it.

Real reviews of the franchise business

Of course, in order to study the business model that interests you, you need to familiarize yourself with the reviews of people who have already bought it, and if there is an opportunity to better know two points of view: current and former franchisees. You can also find reviews on the Internet, below I will give some of them.

Let's start with the positive reviews. It's no secret that various options for organizing the leisure of preschool and primary school children are now in great demand. Below is a review of a franchisee who opened a language school through a franchise and was very pleased:

“I will tell you my story of cooperation with a well-known brand of a language school, I will share my review of the franchise. From my own experience, I was convinced that it is much easier for children to learn foreign languages from an early age. I started looking through the catalog of the most profitable franchises in Russia and saw a network of language schools. We decided to give it a try!

Already in the first six months of work, it became clear that the methodology developed by the network specialists gives excellent results. All instructors in my Center have been approved through the head office. They know the taught language perfectly, they know how to work even with the smallest students. The lesson programs are designed in such a way that you can join the group at any time. The franchise paid for itself pretty quickly, I get support in doing business, new materials are constantly being released. Once a week we meet at webinars, they are conducted by the head office staff, and every year we gather for meetings - all franchisees and employees of the management company! "

Today there are a lot of parents who want to embody their unfulfilled dreams of the big stage in their children. According to statistics, 70% of girls aged 5-7 have attended dance schools at least once. In the review below, the franchisee shares her impressions of opening a choreographic school for the franchise:

“I have dreamed of my business for a long time. But, as a girl, I wanted my business to be not only profitable, but also beautiful. For a long time I could not find my direction, such that everything would really be pleasant, and would be within my power. I accidentally found information about a choreographic school franchise. From the moment of signing the contract to the opening of the school, it took me exactly one month. In the materials provided to me, everything is available and written in detail. The franchisee chat became a pleasant bonus, where we feel like one huge team and always jointly find answers to emerging questions. Taking into account the transferred theoretical and practical base, we were able to gain leading positions among competitors, and this cannot but inspire! I didn’t regret for a minute about my decision to open a choreographic school for a franchise! "

Catering franchises are very popular due to the high demand among buyers. For example, a franchisee who acquired a cafe franchise tells about his successes:

“Why did I choose this particular franchise? I think this is a very solid franchise - that's the first thing. The second is a very rich assortment of various baked goods. My business experience is about seven years, all this time my activity was connected with public catering. I, as an experienced technologist, studied production technologies and was satisfied.

I am very pleased with the opening of this business and the interaction with the franchisor directly. Employees of the management company answer any questions, advise competently, and there is support both day and night!

A clothing franchise business will undoubtedly be in demand. However, there are dishonest franchisors, the author of the following review faced one of them:

“I became another unhappy customer who bought a franchise of a famous clothing brand. The design of the store seemed interesting to me, the sales manager told everything very beautifully - and I, of course, believed it. At first there were no problems, we made a design, conducted training. But as soon as I transferred the money for the purchase of the collection, problems immediately began to my great chagrin! There was no delivery of goods, they always came up with various difficulties. The delivery took a long time, I wasted time and lost clients. In the end, I decided to buy collections from other suppliers on my own, as I did not know how long it would take. I was right! However, the franchisor behaved extremely dishonestly, no one returned the money, there is no support in the process of work. According to the management company, it is needed only at the moment of launch. Although I coped with my difficulties, I do not recommend this franchise to anyone! "

The following franchisee received a negative experience from acquiring a catering franchise:

Conclusion: is it worth starting a business under a well-known brand?

I hope this article helped you answer the question of whether a newbie should buy a franchise, as well as understand all the intricacies and nuances of this business. Of course, this decision requires the most detailed study of all information about the company that owns the brand, analysis of competitors, obtaining feedback from existing and former franchisees. Think, study, analyze and don't be fooled!

If we talk about the most profitable franchises, then it is worth noting that many of the franchises introduced in 2018 in the franchise market have been in the top of the best deals for a long time. A number of these franchisors have a much larger number of enterprises opened on the basis of a franchise partnership than their own branches.

Among the most profitable franchises in 2018, you can find franchises related to the launch and development of enterprises in such areas as catering and clothing trade, the field of medical services, hairdressing business, and much more. Businessmen interested in small and medium-sized enterprises can take advantage of the offers both domestic famous companies and world famous brands.

We bring to your attention a list of profitable franchises in 2018. These franchise offerings are well suited to a wide range of entrepreneurs. These franchises will help you start your own business with minimal effort. You can contact each franchisor from the list directly through the contact form.

List of profitable franchises in 2018

Franchise Contrast

The franchise is a project to open a hookah club. The company providing the opportunity for franchising cooperation has passed the certification procedure and is engaged in legal activities. The enterprises opened under the Contrast franchise are distinguished by a high level of profitability. That is why this franchise can rightfully be considered one of the most profitable.

Total investment required to purchase a franchise: 400 thousand rubles. The franchise agreement does not provide for royalty payments. Representatives of the company provide assistance in choosing a location for the opening of the club. Staff training is provided. Minimum payback period for the project: five months.

CoffeSpace coffee shop franchise

This lucrative franchise is an offer from a company specializing in the coffee business. The number of fans of the brand is estimated today in tens of thousands. Success is due to a number of factors, including the so-called provocative design decisions.

The amount of investments for the establishment of the enterprise is 300 thousand rubles. There is no royalty payment in the franchise cooperation agreement. The minimum amount of a push deposit is 179 thousand rubles. There is no royalty payment in the terms of the contract. The territory for opening a coffee shop is selected with the help of the company's specialists. Preference is given to universities, shopping and business centers. The minimum payback period for the investments made is three months.

Franchise of Artel children's clothing brand store

The company, which introduced the Artel franchise on the Russian franchise market in 2016, is engaged in the sale of high-quality, practical and fashionable clothes for children. This franchise is considered by many experts to be one of the most profitable as of 2018.

The franchisee gets the opportunity to use a full package of standards for document flow and accounting of goods. Regular trainings and testing are conducted for the personnel. The size of investments for the acquisition of a franchise is 800 thousand rubles. Annual royalty payment - 25 thousand rubles annually. There is no lump-sum contribution in the terms of the contract. Space requirements: 60 - 100 square meters. The period during which the investment is recouped is from five months to one and a half years.

Send your request directly to the Artel franchisor now!

Other options for profitable franchises

Below we have selected a few profitable franchises for you that you may be interested in. Please read them.

Starting a franchise business means entering the market under a foreign brand that the consumer already knows. The main advantage of a franchise is that you get a “turnkey business” and avoid many of the risks associated with starting a business from scratch.

Another obvious plus is that, despite the economic crisis, the scope of franchising in Russia is growing. In 2016, according to the General Director magazine, there are about 1400 franchises operating on the Russian market: 10% more than last year.

Which franchise should you buy?

Today the most profitable franchises are in the catering and retail sectors.

The most famous franchise chains in public catering are Baskin Robins, Dodo Pizza, Subway and Stardogs. The payback period for such a business varies from 9 months to 1.5 years.

The world's largest fast food chain, Subway, has opened 644 companies in Russia in 141 cities. The franchise is growing rapidly, since the opening of one Subway point requires a minimum of resources: there is no hot shop in the eateries, so they are launched economically and quickly.

By contrast, clothing, footwear and perfumery stores are less profitable. Given the crisis and the need for large investments, the demand for opening such a business has fallen. However, things are doing well in narrower market segments such as fixed-price stores or express pharmacies.

The fastest growing franchise in the retail sector in 2016 was the Fix Price chain of stores - it has 2050 enterprises in 723 cities of Russia (however, if we talk specifically about franchising enterprises, Fix Price has only 250 of them). The reason for the popularity of the franchise lies in its low cost: 300 thousand rubles. Another advantage is the narrow niche occupied by the company: in the sphere of selling goods at a fixed price, Fix Price is a monopoly in Russia.

What kind of help can a partner expect from a franchisor?

Help from the franchisor can be expressed in consultations, personnel training, equipment supply, advertising support - the list can be much longer, depending on the business area and the parameters of a particular transaction. For example, in retail, as a rule, the founder helps the franchisee with the selection of a retail outlet, equipment, and personnel training.

For example, the 33 Penguins ice cream store chain helps the franchisee choose the location of the outlet, gives recommendations on window dressing and the choice of equipment for outlets, and helps train staff. The company also helps to determine the profitability of the business.

If we talk about the catering industry, then the help of the founder can go beyond the simple selection of premises. For example, the Dodo Pizza pizza chain has opened an entire school for franchisees and developed its own Dodo Is software, which has optimized the work of 93 partners in 71 Russian cities.

What do the numbers say?

Despite the attractiveness of some of the offers on the franchise market, it is important to understand: where you pay little, you earn the same. For example, opening a branch of the popular Shokoladnitsa coffee shop costs 12.5 million rubles with an annual income of 6.5 million rubles: this means that the cafe will pay off only in 2-3 years.

There are franchises where you need less money for entry, and the profit already in the first year of operation covers the initial expenses. On paper, the benefits in numbers look tempting, but not always come true.

The starting cost of the franchise, in addition to the primary costs like renting a retail space and hiring employees, includes a lump-sum fee - a one-time payment that the founder charges the franchisee for using the trademark. In the table below, you can look at the ratio of primary spending and revenue of popular franchises in the market.

Field of activity	Company	Initial investment	Revenue for the year	Profit for the year
Hotel	Holiday Inn	315 000 000
	Marriott	315 000 000
	Hilton	315 000 000
Hypermarkets	Carrefour	315 000 000
	Crossroads	7 000 000	70 300 000	6 000 000
Public catering	Pyaterochka	15 000 000
	Plantain	94 500 000
	KFC	157 500 000
	McDonald's	75 600 000
	Burger king	2 700 000	28 000 000	1 200 000
	Cinnabon	5 300 000	22 800 000	6 400 000
	Papa jones	12 000 000
	Chocolate girl	12 500 000	38 400 000	6 500 000
	Traveler's Coffee	14 000 000	27 600 000	5 500 000
Clothing trade	Oji	11 600 000	39 000 000	5 000 000
	InCity	4 500 000	33 000 000	5 000 000
	Sela	4 700 000	20 000 000	5 000 000
	Mascotte	750 000	24 000 000	3 600 000
	Glenfield	2 500 000	18 000 000	2 000 000
	Westland	2 500 000	12 000 000	2 300 000
	Tom tailor	10 000 000	18 000 000	2 000 000
	Tom far	4 500 000	36 000 000	2 800 000
	Finn flare	2 500 000	15 000 000	3 000 000
Sports business	Gold's Gym	63 000 000
Appliances	Positronic	5 800 000	60 000 000	6 000 000

Many clothing and footwear retailers, for example, InCity, Sela, Finn Flare, offer a low start-up fee due to the crisis. The entry threshold has been lowered as the popularity of such franchises has dropped: people are spending less money on new things. Before purchasing such a franchise in a crisis, it is better to calculate all the risks.

So is it worth doing a franchise business?

Experts and entrepreneurs interviewed by the CEO believe yes. In 2014 they even included franchising in the top twenty promising business areas in Russia for the next 3-5 years.

However, don't think that a franchise business is easy money. Although the franchisor helps, 99% of the success of the project depends on the diligent work of the partner. It will take, in my experience, an average of two to four years to break through, and no one guarantees you success.

The good news is that after working in a franchise, new entrepreneurs usually learn the basics of business and after a while start their own business. If you have that kind of ambition, the franchise business is a great school.

Calculate in advance how much you are willing to invest in the business, not counting the lump sum;
Research the company that sells the franchise (small initial investment and large income should be in your doubt);
Decide on the niche in which you want to buy a franchise. You should have at least a minimal idea about this business;
Discuss in advance what the company will provide you: what support will be provided, for which you will be asked for an additional fee (sometimes this is not written in the contract);
A brand is not always a guarantee of success, discuss with your partner what you will get in addition to the brand (technology, favorable terms with contractors, equipment);
If you buy a code, make sure it is patented;
Study the contract carefully: especially the sections with duties and penalties;
Before paying, be sure to ask for the project launch plan and those responsible for each stage. You must have a clear understanding of how you will launch the project after paying the franchise;
If you are buying an overseas franchise, find out who will localize the project.