Becoming a franchise owner is a simple, low-risk way to kickstart your career as your own boss. We outline everything you need to know about how a franchise works and show you why being a franchise owner is 100% worth it!
What is a franchise?
A franchise is a common business structure that involves the franchisor (business owner) licensing the rights to operate a business under their brand to the franchisee (you) in return for a royalty fee. This may be an upfront fee or an ongoing fee to the franchisor.
Franchises can be found right across Australia and you likely see them every day, including household names such as Jim’s Mowing, Coffee Club, and fitness studios like XTEND. Ready to kickstart your franchise journey in the fitness industry? With locations available across Australia, an XTEND franchise is the perfect opportunity to get you started in the thriving fitness industry.
How does a franchise business model work?
Buying into a franchise is perfect for the budding business owner, who wants to take the first steps into the business world but is still backed by an established business model and support network.
A franchise business is made up of two main parties:
The Franchisor is the business owner, who licenses the rights to operate a business under their brand.
The Franchisee (this is you) is the small business owner who purchases the rights to operate a brand from the franchisor. To customers, you are the face of the business.
What you get as a franchisee:
- The confidence you’re buying into an established and proven business model.
- The freedom to set your own hours and be your own boss.
- Legal protection under the Australian Franchising Code of Conduct.
Is being a franchise owner worth it?
The short answer: yes!
However, it’s up to you what you make of it. Being a franchise owner – like any business owner – is a lot of hard work and determination.
If you’re passionate and dream of being your own boss, becoming a franchisee can be a rewarding experience that gives you the support you need to get started as a business owner.
As a franchisee, you’ll get to:
- Hire and manage your dream team;
- Grow your sales;
- Get to know your customers; and
- Watch your business thrive!
With any new business, you should always analyse your strengths and consider all potential risks, as well as understand your legal and tax obligations as a business owner.
What is the potential for growth?
Buying into a franchise is a low-risk alternative to creating a business from scratch. When you become an XTEND franchisee, you have the support and experience of a wide network of fellow XTEND franchisees and the benefit of a proven business model!
As you become an experienced franchisee and see your first franchise become a success, you may want to consider scaling up. Successful franchisees can often expand and add another franchise (or two!) to their growing business.
Maybe you’re already thinking ahead to your future franchises!
Is being a franchise owner right for you?
Owning a franchise may be a low-risk option for many would-be entrepreneurs. However, you should carefully consider your strengths to determine if this is the right pathway for you.
Before starting your journey as a franchisee, you should consider:
- What lifestyle do you want? As your own boss, you set the rules!
- Are you aware of the start-up costs and ongoing costs of running a business?
- Do you have the time to start a business?
- Do your values align with the franchise’s brand?
How to finance a franchise business?
There are many benefits to owning your own franchise, but the idea of financing your new business can be daunting. You may be in a position to pay the franchise costs upfront, however, it’s probably more likely you’ll choose to finance your new franchise.
If you choose this route, there are many options available to you!
Calculate your assets and liabilities
Before approaching your bank or a broker, you should have a good understanding of your assets, including real estate and other investments, and liabilities, such as mortgages. Remember, a loan is considered a liability on your record and the number of liabilities you have may impact your ability to receive a loan.
Create a budget!
To start a business, you will need to account for capital as well as ongoing running costs of the business. Before you apply for finance, work out your expected expenses and create a comprehensive budget, including running costs, refurbishments and capital.
Go through a broker
Whether you go through your own bank or engage a broker, you have a few options when financing your new franchise.
A franchise broker specialises in helping you find the best possible finance plan. Many franchises – including XTEND! – often have a network of lenders and may be able to connect you to their services when you’re ready.
Are fitness franchises profitable?
Launching your first fitness franchise can be an exciting and liberating experience. And the great news is the fitness industry is expected to keep growing over the next five years, meaning there has never been a better time to make your fitness career happen!
When you join the XTEND community, you’ll have the freedom to create income streams that suit you and your customer’s fitness needs. In fact, fitness franchises could potentially earn up to $210,000 a year.
Franchise with XTEND!
Ready to take your first steps towards owning a franchise? We’re looking for passionate franchisees to join our growing XTEND team!
When you join an XTEND Franchise, you’ll be supported by our community who are dedicated to improving the health and lives of people all over the world.
If you’re ready to kickstart your franchising journey, get in touch with our team today!