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Is It Worth Being a Franchise Owner? Earning, Hours & More! (2022)
Written by: Parth Parth
Last Updated by
Brenda Bagnoli: July 15, 2022
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Franchising is a great way to start a business as it allows you to basically sell an established brand and its methods without having to figure it all out yourself. There is huge profit potential in franchises if you do them right, so here are some common questions you might wonder about as you start your franchising journey, like how much franchise owners earn.
How much do Franchise Owners earn?
Looking at pay for the franchising industry, it can vary greatly. Some of the top franchises like Wendy’s pay upwards of $300,000 for the median franchisor and if you do more business than the median, your salary will go higher. When starting off, your pay might not be as high, but as you climb the franchising ladder, establish a big customer base and get their loyalty, you will start earning more.
We estimate it can take between 1 to 3 years for a franchise to start making close to its potential earnings. This, however, varies from industry to industry and location to location. As such, when looking at a franchise, you should do your due diligence. If you want us to review a franchise for you and give you an estimate of our earning potential, reach out.
How long do Franchise Owners have to work?
Depending on what your business is, and how much money you want to get out of it, you can be working anywhere from the same amount of hours you would working a full-time job to basically absentee ownership. It really depends on which franchise you have opened and whether or not you want to pay for additional staff members or not. when you’re just starting your business, you might be working close to the same number of hours as you would in a full-time job without taking any money home. This is really important to keep in mind as you work through the process of starting a franchise.
Later, you might have the option to transition to absentee ownership the restaurant will basically run itself and you can net the profit from it.
Does it cost a lot of money to franchise?
No, it does not cost a lot of money to start a franchise. There are well-recognized restaurant chains like Chick-fil-A that only cost you $10,000 to start. There is also help available from the Small Business Administration (SBA) Which can help you find a loan for your franchise or small business. You can also start a small franchise like Sign Gypsies that does not have a high start-up cost and you can basically get set up in a week of being approved.
Note that when you are starting a franchise, the initial investment could be anywhere from $10,000 as we have shown above to upwards of $2 million. So there is a lot of room to choose from depending on your situation and goals.
What are the possible industries I could franchise?
There are a ton of industries available to franchise. You can look at which would include chains like McDonald’s, Domino’s, Pizza Hut, Baskin-Robbins, and much more. if you want to go into the Home Services sector or the janitorial sector there are franchises like JAN-PRO. There is a ton of opportunity available and if you need more help figuring out what industry might be a good goal for you, you should take our Entrepreneur Quiz or get in touch with us and one of our analysts can guide you through the process of selecting and starting a franchise.
Why should I franchise instead of starting my own business?
This is a very good question and an important one to ask while starting a franchise. We recommend starting a franchise because there are a lot of franchises In the market which gives you a lot of breadths to choose from. Also, a lot of franchises have an established customer image.
For example, if you walk into a McDonald’s franchise you know that you are going to get a certain standard of food. The golden arches are also recognizable from a distance. Another huge benefit of franchising is that you do not have to come up with your own menu or service offerings. The franchisor will provide you with all that you need including an initial inventory, training, and sometimes even ongoing support.
What are some other things I need to consider when starting a franchise?
This is a broad list but some of the rough things are:
- Some franchises offer discounts for certain groups like veterans. Be sure to check with the franchisor for any discounts you might be eligible for.
- Look at past lawsuits. It is very much possible that a franchise that looks perfect on the surface has a murky legal history.
- Ask questions to the franchisor and talk to at least 3 -5 franchisees of the company. If they’re in your general area, that is even better. Current franchisees are going to provide you with a lot of valuable information on potential financials and whether or not the company has a good relationship with its franchisees.
- Lastly, and we cannot overstate this enough, do your due diligence. You do not want to be stuck in a business that you do not like or whose promised product is different from what you are actually being given.
Conclusion
While we cannot comment on each individual situation and different types of business and work models work for different kinds of people, franchising is a good way to start a business. If you are in the right franchise, you can earn a lot of money. We advise you to consider the pros and cons of working and running a franchise and choose accordingly.
If you need any help, you can always get in touch with us at Vetted Biz and we can help you. Vetted Biz also publishes blog articles analyzing franchises that can have a look through and get in-depth analyses of owner salaries, how the franchisor is doing, how much can you resell for, and much more!
