Blog

How to Start a Business Without an Idea for a Product or Service

By August 20, 2019 November 11th, 2019 No Comments

Fed up working hard and making your boss rich, but don’t have an idea to start up in business yourself? Then investing in a franchise could be the perfect solution for you. Read on and we’ll tell you why:

What is a franchise and how does it work

A franchise is when you sign an agreement to use the branding, products/services, business model and marketing materials/promotions of another company. In return, you will pay that company (the franchisor) a licensee fee plus a percentage of your profits (royalties).

Franchising is actually a partnership between the franchiser and the franchisee (person who buys into the company). Having said that, it’s not exactly equal, since the franchiser sets the guidelines etc. But that’s only fair since they started the business from scratch and had the concept in the first place. It’s more of a beneficial partnership since the franchisee can always turn to the franchiser for help – whether that’s in terms of pricing, marketing, staff training, client relationships etc. That’s because it’s in the franchiser’s interests to ensure the franchise is working well and to guidelines.

Examples of franchises 

The most well-known franchises are McDonald’s, KFC and, here in the UK, Wetherspoons. Although predominantly restaurants and food outlets, there are also franchises for plenty of other industries such as car rental, cleaning, care at home, fitness and… yes, property.

Why you should – and perhaps shouldn’t

Pros

  • You won’t have any competition from the company’s other franchisees, since they only allow one franchise per geographic location;
  • The franchisee already knows the business model is a success (in terms of the franchisor’s profits) so that provides a sense of confidence and optimism from the start;
  • You won’t have to fork out a fortune on marketing and branding materials since these are already provided by the franchisor;
  • The products or service is already created so you can get started quickly;
  • You’re buying into a company whose reputation has already been established (someone else i.e. the franchisor has already done the hard work in that sense);
  • You’ll receive ongoing training and support from the franchisor. This can prove extremely reassuring – especially when you’re just starting out in business for the first time – to know there’s always someone else’s proven knowledge and experience you can tap in to;
  • The concept of franchising is a recognisable and proven method of successful business operation. The franchising trade body here in the UK is known as The British Franchise Association (bfa).

Cons

  • You’ll be paying part of your profit to the franchisor (in the form of royalties);
  • The franchiser retains control over the product or service i.e. they set the guidelines over how the basis of the operation is run and when certain promotions take place etc.

Here at Sourced, we offer our own unique franchise opportunity. The first of its kind in the UK property investment sector, the Sourced venture trains franchisees to identify investment opportunities. At the same time, you will learn how to structure purchases and come up with bespoke strategies to help property investors gain their financial goals. Interested? Then learn more at Sourced franchising.

Here at Sourced, we offer our own unique UK property sourcing franchise opportunity. Read more about it here.

Chris Kirkwood

Chris Kirkwood

Development Director, Sourced.