The Home Business Franchise Option

The home business franchise option is to purchase a franchise that can be operated and managed from a residential location. With a franchise, you pay someone else for the right to sell and distribute their products or service and use their trade name or trademark. A franchise fee is charged and, depending on the franchise, there may or may not be on-going royalty fees, advertising costs or the mandatory purchase of the company’s supplies needed to run the franchise. However, there are advantages and disadvantages to owning a franchise. They include but are not limited to the following:

Home business franchise advantages

• Risk and failures are fewer than when starting an independent business.
• Franchises can provide product name recognition.
• Franchises can provide a location and professional start up advice.
• Franchisers will monitor franchises and help with any operation difficulties.

Home franchise disadvantages

• Franchises can be expensive to acquire
• A franchise is not really your business
• What you really have is a contract to operate the franchise, usually for 10 years, which may or may not be renewed.

Before you purchase a home based franchise

• Make sure the type of franchise business is something you want to do and think you would enjoy. A good match is still a key requirement for success, whether the business is a franchise or not.
• Check out the franchiser and talk with current franchisees.Have your lawyer go over the franchiser's Uniform Franchise Offering circular (UFOC).
• Conduct your own market research to make sure that the local market will support the franchise and that the franchiser’s research statements and forecast are correct.
• Become a customer of the franchise to make sure that you like and believe in products or services being sold.
• Make sure the franchise can meet your financial needs.

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