What is a Franchise Opportunity?

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When it comes to the question, what is a franchise opportunity?, if you are business savvy, you will know that it is a proven business that uses systems and branding from an already established business to create a service or products in a geographical location (that the franchisor is not currently operating) for which there is a known demand. However, there is much more to franchising than you may first assume, and it is this information that here we want to share.

The uninitiated prospective franchisee can fall for misleading or conflicting information and hype, and consequently, the franchise world can suffer from negative media content. However, the UK franchise industry alone earns billions of pounds every year for successful franchisors and their franchisees that you could tap into with the correct information and guidance.

The Legal Definition

A franchised business is a business that has a proven business model in that it will have been operating for a period of time (generally at least three years) it will have been shown to be viable and profitable, the owners will have developed the system, and this system will have been written into an operations/training manual and that an individual may purchase this system together with the training and ongoing support from the franchisor. The business you purchase allows you to use the brand, logo, name, and business model to replicate the service or products in your own operational territory.

A franchise opportunity is not an opportunity to buy the entire business but just the rights to trade using the businesses system, model, information and ongoing support.

Franchising is a popular way for individuals to get into their desired business without the risk of building something from scratch. Historically 90% of new start-up businesses fail within five years; however, it is also shown that 85% of franchised businesses succeed in that same five-year period.

Seeking a Franchise Opportunity

Finding the right franchise can be daunting as there are so many options on the market. However, an excellent place to start is with a field you are interested in that allows you to utilise your own skills and experiences. Suppose you can match a business to an opportunity in a field that attracts you and where you can personally see the potential. In that case, you are much more likely to be successful when it comes to developing and building your local franchise.

There are many online databases of franchises available, and we would recommend that you use a franchise site that is well known and offers many different business types. Directories that only offer one type of franchise are often affiliated with the franchise it recommends, and this means that you may end up with biased advice.

Who Owns the Franchise Opportunity

The franchisor who built and developed the original business and then subsequently developed the franchise and the franchise opportunity is the franchise opportunity owner.

Following your assessment of the franchise opportunity and the franchisors assessment of your suitability, and if successful, you will be given the opportunity to pay an acquisition fee, sign a franchise agreement and submit yourself to training by the franchisor. Once this has been completed, you will be assigned to your negotiated territory and appointed as the legal owner of that local franchise. You own the rights to operate the business using the brand, the mark and the system subject to the franchisor’s methods detailed in the franchise manual or knowledge base.

Who Owns the Franchise Opportunity

This is the standard basis of what is known as a Business Format Franchise. Your licence agreement will typically have a clause allowing you to sell your franchise, for example, if you want to retire or if you have a new opportunity you want to take up in a different field. If you have built up a profitable business, it’s an excellent opportunity to realise your investment. The franchisor may already have people interested in your territory, so it could be an easy, quick sale. Even if you have to advertise the business, the franchisor will assist and businesses with track records and showing good profits are always in demand.

The good thing about this business model is that the franchisor needs your business to work to reap the rewards as much as you do. To ensure this happens, you will find that they tend to offer mentoring and training packages as part of the franchise deal and will always be on hand to help you maximise profits.

Who Shares The Profits

An essential aspect of owning and running a franchise from a successful franchisor is that they will help you maximise every aspect of your local outlet. This includes training and support as necessary. The franchisor will continue developing the business model to all their franchisee’s advantage, something you would never have the resources to do on your own.

This will mean you will make more profit as an individual business and after you have paid your wages, operating expenses and franchise fees. It is important to remember that you will be self-employed or a director of your own company, so, therefore, you will be responsible for your own tax liability. However, your franchisor will be able to recommend a good accountant for you.

What If Things Go Wrong

Sadly, not all franchises are successful, and sometimes people find that a franchise they have purchased and started to operate is not what they expected.

What If Things Go Wrong

When this happens, your franchisor will want to help you to come to a mutually agreeable solution. Most franchises will require you to sign up for a minimum period, so if you decide to leave or give up the business, the franchisor may expect compensation if there isn’t a new franchisee standing by to jump into your shoes.

If you make the decision that you can no longer wish to operate your franchise, you will need to:

  • Meet your franchisor and discuss the situation to see what support there is to help you sell or close down your franchise.
  • Agree on an action plan with the franchisor so that the business can be sold or closed down
  • You will need to return all documentation, equipment and intellectual property that your franchisor has given you. Your franchise agreement will also have a clause that requires you not to set up in a similar business, for a one or two year period and with a radius from where your franchise was operated.
  • Finalise your accounts and pay all wages, invoices, tax accounts, redundancies required to close down your business.
  • If applicable, work with the new franchisee to ensure the business does not need to close down before someone new takes it on.


In short, a franchise opportunity can be incredibly rewarding if you have the business acumen to make it work. Franchises are not ‘get rich quick’ schemes. To make your franchise successful, you will need to be committed and work hard – especially in the early days.

Whatever the franchise costs, you will need additional funds to support yourself whilst the business gets going. Remember also, if you borrow money to buy the franchise, then you will need to pay interest and at some stage start paying back the capital, which will come out of your profits.

Importantly you need to be a team player, not only with your franchisor but also with your fellow franchisees. They will be an important resource to help you build your business. Your franchisor and your fellow franchisees are your peers; you need to respect them and work with them. You will need to work the franchisors business model to the letter, don’t try to re-invent the wheel; that is the worst thing you can do.

Finally, whatever you decide to do, you must complete thorough research before jumping in. Please do your due diligence, ask to speak to existing franchisees, get a feel for the franchise through them. Knowing your franchise inside out will help you make it a success and so reading the fine print and understanding how much you will need to invest each month to see a return is imperative before you sign any document.

It’s a growing trend today for people to give up the corporate rat race and own their own business. Taking up a franchise opportunity has shown to be a very satisfying and rewarding way to realise this dream. If you take up one of the opportunities advertised on our portal, we wish you all the very best for your enterprise and wish you many years of success and satisfaction.

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