Guide

Buy a franchise

How to purchase a franchise

There are a number of key things you need to consider when planning to buy a franchise.

What you should consider before buying a franchise

  • Assess yourself to see what kind of franchise, if any, will suit you. Should I buy a franchise?
  • Find out what franchise opportunities are available and draw up a shortlist. Find out about possible franchises.
  • Assess franchise opportunities carefully, ask questions and talk to other franchisees.
  • When you find a business, investigate its financial prospects. Base this on thorough research of performance figures. Include an analysis of three years' accounts - if they have been trading for that period - and management figures.
  • If you'll need to raise finance, ask your bank if it will consider a loan for the type of franchise you're considering.
  • Do your own market research into the business and the competitors in your area.
  • Draw up a business plan.
  • Check the franchise agreement and get professional advice from a solicitor and an accountant.

However, it is advisable to make sure you don't:

  • take up the first opportunity before investigating alternatives
  • allow yourself to be hurried into making a decision
  • pay any non-refundable deposit
  • commit yourself before you're completely sure
  • assume a business will work in your area just because it works elsewhere
  • rely on the forecasts provided by the business selling you the franchise
  • sign any agreement without legal advice