Starting, buying or franchising
Consider all the options available to you - starting a business, buying an existing business, or going into a franchise. Choosing the best option can be the difference between running a business that makes you money or one that costs you money.
Starting a business
- You have complete control over the business.
- You can choose and set-up every aspect of the business (products and services, premises, equipment, suppliers, staff).
- You can develop your business and grow over time.
- It may be difficult to obtain the initial finance.
- You may not have an established customer base, and you may have to compete with strong, existing businesses.
- Your business may not be profitable at first.
Buying an existing business
- There is an existing customer base.
- You do not have to purchase equipment and stock.
- Previous financial records give you an estimate of running costs and profits.
- The business may have financial or legal problems.
- The business's success may depend on the skills and experience of the previous owners.
- The previous owners may be selling as they see tough times ahead so you may not be able to grow or expand the business.
Going into a franchise
- You are supported by the franchisor and have access to training, information and resources.
- Market exposure is higher than with most businesses as your business is an established brand.
- Your expenses may be lower through the collective buying power of the franchise.
- You cannot run your business independent of the franchisor.
- If you want to make changes to your business you may not be able to. You can be restricted by your franchise agreement.
- Your reputation can suffer if other franchisees have a poor reputation.
Seek advice before you sign
You must get professional advice before you start or buy a business, or go into a franchise. Your solicitor, accountant and business adviser can help you to thoroughly examine a business or franchise before you sign a sales contract or franchise agreement. We recommend that you consult advisers who specialise in buying or franchising, as they have the experience and knowledge to help you avoid any problems.