Common Franchise Questions and AnswersBelow are the answers to our top franchise FAQs, from general franchising questions to a few common queries about Neighborly®.
Neighborly is a family of home services franchises. To customers across the U.S. and Canada, we’re known for providing high-quality services to repair, maintain, and enhance the entire home. To our current and prospective franchisees, we’re known for our award-winning brands and top-notch support for all our local franchise owners. Learn more about us.
A company (the franchisor) gives other parties (franchisees) the right to use its trademark and recognized brand to sell goods or services according to the company’s terms, and for a specific cost. Franchise owners are independent, locally owned and operated businesses. The franchisee may benefit from the company’s established systems and other support. Visit Franchising 101 for details.
Many want to be in business for themselves without reinventing the wheel – so systems are key. As a franchise owner, you have the freedom to be autonomous but still have a team at corporate and peer group to mentor and provide guidance along the way. Some owners say they love the ability to control their own destiny, and others cite their greatest benefit as the freedom to set your own schedule and enjoy a more flexible work environment. There are also owners who say there’s an incredible sense of satisfaction in building a team, providing opportunities for others, and watching a business grow.
COSTS AND INVESTMENT INFO
A franchise fee is what a franchisee pays a franchisor as a licensing fee at the beginning of their agreement. Franchise fees vary drastically, but the average range is $10,000-50,000. The franchise fee is not the full up-front cost of the franchise.
Initial franchise cost varies significantly depending on the brand, industry, and territory. A majority of franchises cost between $50,000 and $200,000 to get started. There are two costs when starting a franchise – the initial franchise fee and operating capital. Then there is the ongoing license or royalty fee. There are a variety of financing options, and a Franchise Developer can help provide a better understanding.
To open a franchise, you need funds, dedication, and a full understanding of the franchise agreement. Plus, you need to research to determine the right industry, price point, and brand for you. Here’s a resource for evaluating franchise opportunities. Once you’ve narrowed it down, ask your top franchisors plenty of questions, and secure the proper funding for your chosen franchise.
Yes. When you purchase a franchise as a franchisee, you do own it for as long as you remain in the franchise agreement. You can use the company name, trademarks, and network for training and marketing purposes, subject to the particular franchise agreement you sign. It’s your business, but you have a support system and resources for success, including help with the sale of your business, also known as your exit strategy.
RESEARCH AND QUALIFICATIONS
Choosing a franchise in the home services industry that can meet your personal and professional goals is simple. To begin, ask yourself: “Am I passionate about this opportunity?” and “Am I ready to dedicate the hard work necessary to run this franchise?” If you answer yes to both, you’re on the right track. Next, make sure the business plan, industry outlook, and franchise agreement all align positively with your expectations.
While no two franchisees are alike, successful owners should have a strong desire to succeed by using established business systems. It’s true that franchising can ease common pain points of sole business owners, but growing any business takes hard work. At Neighborly®, we look for franchisees who are values-driven (respectful, motivated, and customer-focused), financially stable, and like to have fun!
No, you do not need a degree to own a franchise. While a degree in business, an industry-relevant certificate, or a management course are all valuable assets to a franchise owner, many rely on hard work and real-world experience to succeed. Check out the stories of two people with totally different backgrounds who became franchise owners.
No, you do not need to be rich to open a franchise. There are franchises with lower costs of entry that people with an average income may be able to purchase; especially with good credit and solid franchise funding.
The answer to this question really depends on the franchisor you choose to work with. Some franchisors only offer startup training, while others offer ongoing training and educational resources for owners and their employees. Learn more about what is included in a high-quality franchise training program.
Typically, an existing home service business owner will look to a franchisor to help them overcome obstacles and achieve their personal and professional goals. Neighborly has helped a number of home service business owners convert their small businesses to franchises.