Franchise Fee- Worth it ?

zackary71

Hi
I'm actively looking at joining a well established Franchise but what's putting me off is the fee ? Cost is somewhere around between 15-20k and tied in for 5 years(understandable)
I've done a lot of research already and in effect, you are essentially buying a job when you purchase a franchise. But how does one value it in terms of value for money ? What I'd be getting up front is kitted out vehicle, a proven biusiness model, initial training, promotional launch, national marketing and call centre leads/support...which is a lot less than purchase cost.
Am I looking at this the wrong way ? Should I be looking at it from the potential long term gains instead ?
All advice gratefully appreciated
Zack.

steve1980

Who is the franchise with? Without knowing who/what the business is then it's hard to comment.

zackary71

Thanks for reply...It's Ovenclean. (better not put link on here though)

steve1980

Who!!!???

I've never heard of them, but having just looked on their website I can't see how you could possibly make any money at all.

You can get the oven cleaner packs from all the major supermarkets, yes it's not a nice job, but still a hell of a lot cheaper than getting someone in to do it.

thenudeone

It's not really buying a job because YOU have to do the work before you get paid. They are not paying you a wage.

Depends on:
What you are actually getting for your money.
How much you could buy the same things for, if you decided to do it alone (if it's equipment)
How much any intangibles (eg marketing) are worth. You could pay for your own marketing, leafleting and advertising
What else simply stops you from setting up your own busines without the franchise?

They are in business to sell franchises, not to sell your oven cleaning services. How hard will they be working to get you new sales, and why? Do you have to pay commission based on sales?

You don't need to answer them here, just things to consider.

Slinky

I publish a couple of local magazines and have a former Ovenclean franchisee advertising with me. I think he got fed up with paying their fees and went independent.

There's money to be made in ovencleaning, but it is hard work, which is why there is money in it. I pay £49 to get a double oven cleaned, but he's here 2.5 hours doing it and makes a fantastic job of it.

Can you face cleaning ovens day in day out for a living? I couldn't which is why I'm happy to pay money for somebody else to do it. I'm not sure I'd pay £15-20K for the priviledge.

paulwf

It annoys me a lot when people put down franchising as "just buying a name" because there is a hundred times more to it than that but it is true that a franchise is only worth having if you are signing up to the market leading brand name.

I can't see this is the case here, no one cares who cleans their oven. I think everything they offer you could do on your own, I'm sure you can work out your own cleaning system, have a mobile to answer calls and do some leafleting and advertising.

It's also a bit of a one trick pony, if you don't find enough ovens to clean you're stuffed. Although having a focus and speciality is good offering a few more services would give you a much better chance of succeeding. Most franchises restrict you from adding services anyway.

zackary71

Thanks for all your replies....really helpful feedback as the "cons" side of list has suddenly grown a lot longer.
Guess that is a reality check in itself.

DermotFlanigan

I would consider what you can do independently with that 15 -20k. You could get a small van for around 4-5k, website, leaflets, sign writing for well under a grand. Then you just need to source the right equipment so I think you could set it all up alone for under 10k with no restrictions on services or equipment / cleansers...

lincroft1710

There are at least 4 companies offering oven cleaning franchises. I presume you've investigated them and decided on Ovenclean. Was it because they charge the cheapest franchise fee? As other posters have said why not just set up on your own.

heretolearn_2

Franchises can be an excellent way into business - but you need the mindset that you are setting up a business, not 'buying a job'. If you don't take it seriously as a business and be aware that it takes just as much work, really, as running a business independently, then you are going to fail. Yes, there ARE some services provided by the franchiser, and what they are varies, but a lot of people think they can buy a franchise and sit back while work just falls in their lap. And go broke pretty quickly.

I think it's only worth buying a franchise that you couldn't set up yourself, so for example a market leader brand, or a niche market where you are really going to benefit from their expertise/support/training. Any one can clean an oven. No one cares about the name of the company that cleans there oven. The only small advantage I can see is that you'll benefit from a national advertising campaign, but what is that exactly and is it worth the fee? How much business do you need to do after paying their fees to turn a decent profit? Would you be better off setting up independently, having higher marketing costs but keeping what you earn.