How to determine which are the most profitable franchises?

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It is not essentially a simple task. When you decide to buy a franchise it is important to understand your abilities and research the market extensively. It is not necessary that higher the investment is, higher will be the profits, in fact this could be just the opposite.

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How to determine which are the most profitable franchises?

  1. 1. As businessmen we are all quite ambitious, without ambition nothing much could be achieved. When you think of investing in a franchise, it is pretty much obvious that you want to invest in the most promising and most profitable franchise business there is. Question is all franchises claim the same, then how will you identify if it is the best option you have. Which one is really a most profitable one? on Top 500 lists? that has the longest chain? that has been there for the longest time? that has the highest investment? that has the best brand name?
  2. 2. It is not essentially a simple task because the answer is all this and more. When you buy a franchise, your decision is not only dependent on profitability but also your own capacities in terms of finance, time and business acumen. Therefore when you decide to buy a franchise it is important to understand your abilities and research the market extensively. It is not necessary that higher the investment is, higher will be the profits, in fact this could be just the opposite. There are many factors that come into play. So that you identify the most profitable business to start, first and foremost ensure that you have looked at your financial capacity, valued your assets, worked out on how much time can you spare and importantly what kind of familial support you have. Once you are completely ready and have chosen the products or services that you could best sell, then you need to conduct a robust research on what are the franchise options you have. Shortlist the franchises that match your requirement, once through with your list, you are ready to undertake in-depth study of each franchise. Fill out applications to get the initial documents from the franchisors, check the market viability, talk to existing franchisees and more. Few of the important factors to consider are the return on investment, breakeven point, and annual fee.
  3. 3. When you have established all of the above you fairly have deduced to your list with a few possible investment choices, what then? Study the market for need of such franchise in the locale you are benching on. It is important to ensure that there is a need for the product and service of the kind the franchise is offering in the local market. The study could be primary or secondary in nature. Analysing the need for the product/s or service/s in the local market is essential and profitability depends entirely on the sales within the region allocated to the franchisee. Of all that is good, sublimity is supreme. Succeeding is the coming together of all that is beautiful. Furtherance is the agreement of all that is just. Perseverance is the foundation of all actions. Lao Tzu
  4. 4. A franchise’s profitability depends on multiple variables. The risk is comparatively less in franchise business, however high profitability is a balance between all the pointers discussed above. The most profitable business is subjective and hence one has to carefully consider each of them. IIHT Technologies has been growing at an exponential rate for over a decade with 40% CAGR, it mentors its business partners and provides complete support to the partners. Its business partners are as well committed to high quality and hence ensure growth. A Franchisor could offer all the support, however an equal or greater commitment from franchisee’s end can ensure higher profitability of a particular franchise.
  5. 5. Corporate Headquarters #15,Sri Lakshmi Complex, 4th Floor, St. Marks Road, Bangalore - 560 001. India Tel: 91 80 6160 4545 e-mail: franchise@iihttechnologies.com web: www.iihttechnologies.com/

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