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In considering whether a franchise or franchise opportunity is the right business choice it is worth considering just how the franchise market is built. Here in the UK the idea of a franchise for sale somehow has less kudos than an opportunity to invest in a privately owned business.

There is a level of complexity in the Franchise market that in general is not understood. A couple of hours investigating the diversity of business opportunities available confirms that the market is segmented into a number of different offerings. In a sector that is supposedly worth ten billion pounds and employs 360,000 the complexity should not be underestimated.

At the top of the market the huge well know high street brands such as McDonalds (probably the most well known franchise operation) offer an particularly successful business model and brand. A Franchise Opportunity with these types of market leaders is not for the faint hearted, a large personal investment will be needed, extensive training and exposure to the companies established brand and behaviours are compulsory. In return for the considerable financial and professional commitment the company model is rock solid and the business and marketing plans should be well recognised and easily put into practice.

Of course with such a heavy investment and relatively low risk, returns are likely to be less than other opportunities.

The second tier offers less investment, the prospect to be flexible within the distinct product or service and in general lower investment. These opportunities are unlikely to be well know high street brands but may take up the secondary pitches in the central business district or even we see some internet companies falling into this category. As with the top category there will be an established brand and proposition to be adopted but there may be opportunity for a little “self–expression” as the profile of the company is likely to be lower and the market may well be regional in nature. Franchises such as Monkey Music and 0800 Handyman would fall into this category, they are very successful franchises in their own rights but not greatly visible on the high street.

The final category is that of start-up franchises which offer the potential entrepreneur the opportunity to get in at the ground floor. These business ideas when offered as a Franchise For Sale are the innovative business plans that do carry a higher level of risk, in that the sales proposition, and even the management of the holding company may be not yet fully organised. The infrastructure will be in place of course but the businesses are likely to be quite new. Depending on the franchisee’s attitude to business these cheaper opportunities may well be the most attractive as they do allow for a certain amount of development and flexibility, some will even actively encourage the brand development from within the membership. If you’re searching for an opportunity to form the franchise then getting in at the cheaper end of the market may well be a good decision.

fundamentally the franchise market is many layered, complex and provides a number of opportunities dependant on the investors available capital, attitude to risk and medium to long term targets.

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