What are low-cost franchises with high profit? Learn what types of franchises offer the greatest rewards at the lowest costs, and what you should consider when choosing.
WHAT CONSTITUTES A LOW-COST FRANCHISE?
Buying a franchise is one of the best ways for people to achieve their dreams of owning a business and working for themselves with the support and structure of a proven brand system. And while buying a franchise may have once seemed like an unlikely venture for individuals working with less startup funds, these days there are many great low-cost franchises with high-profit opportunities in various industries for motivated entrepreneurs from all walks of life to explore.
Lower startup costs are certainly one of the biggest initial benefits of a low-cost franchise. New franchisees hoping to get their business up and running without a large initial investment will be especially drawn to low-cost options. Typically, initial franchise fees can range anywhere from $10,000 to $60,000 for a single unit. Many newer franchises offer lower investment opportunities as they are still in the process of fully establishing their brand. If you can recognize a winning concept and get in on the ground floor, your earnings potential should only grow as the franchise grows. At the same time, there are plenty of well-established, successful franchises that provide a lower barrier of entry because they are confident in the lasting impact of their brand and owners.
Not all low-cost franchises are created equal, and it’s important for each prospective owner to consider his or her own strengths, goals, and investment capabilities, as well as what they hope to receive from the franchisor in return for their investment.
VALUE FOR VALUE
Some types of franchise businesses will inevitably be more expensive to start. For instance, investing in a new restaurant location may require you to pay for construction, remodeling, new kitchen equipment, etc. at the outset. On the other hand, a home-based or mobile business model that requires low or no on-hand inventory will not include such costs and should therefore be much less expensive.
Still, it is reasonable to assume that even if you choose a low-cost franchise, you should still receive the highest level of training and support that the franchise is able to provide. Buying a franchise means buying more than just the use of a brand’s name. Your initial investment should cover both startup training as well as ongoing support for you and any staff, but the extent of that training may be reflected in the level of your buy-in. And the level of continuous support you receive may have an impact on your overall profitability. It’s important you do your due diligence and partner with a brand that provides you with the greatest value for your investment and aligns with your needs and goals.
HOW IT WORKS
Some brands offer incentives and operating models specifically for new franchisees to help them get started and build momentum through their initial years. Examples include reduced royalties for the first year or two, deferred franchise fees, or smaller scale versions of their brick-and-mortar locations.
Many franchisors offer discounts to veterans and minority groups. These can also include lower initial franchise fees and/or reduced royalty payments. Franchisors usually advertise these incentives on their websites.
Some franchisors also offer limited-time deals on franchise fees and royalties, deferred payments, money-back guarantees, and other promotional incentives. These can be limited to specific geographical areas or markets where the brand is seeking to break in or expand its impact, presenting the opportunity to prospective new owners who might not otherwise get the chance.
Regardless of your level of investment with a franchise, you are entering the process with your eyes wide open to both startup and ongoing costs, unlike with an independent business, which can be more unpredictable. Based on the experience of existing franchisees and the information provided by the franchisor, you can gather an accurate picture of startup costs, future expenses, and make a decent approximation of when your revenue stream will turn positive.
LOW COSTS AND HIGH POTENTIAL WITH TAILORED LIVING
Low-cost franchises with high profit do not necessarily imply quick profit, so keep that in mind when considering your options. Fortunately, a lower initial investment often means that the franchisee can feel less pressed to recoup a large startup amount quickly. And even with a low-cost franchise, you may still need significant funds to maintain your franchise until it begins to generate revenue and turn a real profit.
Some of the most quick and profitable low-cost businesses include food trucks, car washes, auto repair shops, and personal training services, but obviously not all of those present franchising options. The home improvement industry, on the other hand, presents a plethora of options suitable for a range of investment levels, goals, and skillsets.
A low-cost home improvement franchise with high profit has the added benefit of being part of a recession-resistant industry with long-term growth potential. Whether you choose a handyman franchise, cleaning services, garden and yard maintenance, or repair and remodeling, these businesses are well-suited to both home-based and mobile operations, keeping overhead low as you build your client roster and grow your impact.
EXPLORE THE TAILORED LIVING FRANCHISE OPPORTUNITY
With a total initial investment of $185,220, Tailored Living provides in-house financing on up to $44,000 for qualified candidates to make an already low-cost franchise investment even more affordable. Qualified veterans may also receive a 15% discount off the purchase price of a Tailored Living franchise.
As the largest whole home organization franchise in North America, Tailored Living relies on the enthusiastic participation of all our franchisees, and we support them by providing next-level training, on-going business support, and a winning business model that keeps us at the top of a booming industry.
To learn more about franchising opportunities with Tailored Living, get started today.