Mark Savill, Director of the successful UK Franchise Novahomes Ltd, offers his top 10 tips to help you pick the best franchising option for you.

1. Do your research. There are a lot of potential franchises out there to choose from. You need to make sure you are happy that their proposition works. Interview them thoroughly. I have seen one instance where a firm of office based agents is offering a franchise that is non high street and web based – despite the fact they have not tried the model themselves.
2. Check the projected sales numbers carefully. You need to know what other offices in that network are achieving to work out your potential income. If you think the figures are unrealistic then they probably are. As a double check work out a break even analysis – how many completions will you need to do to make sure your business breaks even?
3. Will the franchise work in your town? There are obviously some towns that are better than others and some propositions simply do not work in some areas. Make sure that the one you select is right. If the one you choose requires significant mortgage penetration to achieve success and yours is a rural retirement retreat you may come unstuck.
4. What level of support do you want? Some offer full support and back office admin for your business. Others offer very little. The knack is to pick the one that is right for you. If you like the structure of a large organisation then a fully supported package is the way to go – particularly if you lack experience. If you have the experience and want the freedom to run your business your way there are packages for that too. The advantage is that these should be considerably cheaper!
5. Speaking of costs – what are they charging you? Look at the up front costs and also the monthly costs. Is it value for money? If you don’t need all of the package, why not find a cheaper option that means you are buying only what you actually want.
6. What tie-ins are you signing up to? If the proposition is heavily dependent on you selling the company’s products through your business you need to know you are being fairly remunerated for that. If you think their slice of the money is too big and yours too small look for a package with fewer tie-ins that will allow you to source these extra solicitor and mortgage revenues for yourself.
7. Do you like the people? People buy people. You need to be able to work with a company that you can trust. A lot of that trust will come down to how well you get on with the faces of that company.
8. Read the small print too! You may like them but they are running a business. Make sure that the contract you sign protects you and at the same time means that you have genuine exclusivity in the territory you are buying.
9. Be aware of the changing market place. The old adage is turnover is vanity and profit is sanity. Sometimes a low cost approach – such as a web agent – can be more profitable run as a small business than as a large one. The debate on high street versus out of town will rage but in a tougher market you should look very carefully at all the costs involved.
10. Most importantly look for the simple solution. Too many propositions are too complicated and have too many income streams and bolt-ons to make the business viable. Pick a business that allows you to do the most of what you are best at. Simple really does work best – especially in a tough market where focus is everything.