How Much Should You Spend on a New Franchise Business in Australia?

woman talking on the phoneAustralians who plan to buy a screen printing business for sale should consider how much they are willing to spend on franchising fees, which could cost as low as $5,000 or even up to $1 million.

The Franchise Council of Australia (FCA) said that these fees only cover the upfront charges and set-up costs. Depending on the agreement, a franchise may pay routine fees for support.

Franchise Expenses

Some recurring charges include regular business and marketing support from the franchisor. The fees may be based on a fixed rate per month or a certain share of turnover. The usual month rate costs at least $50. Percentage-based fees may account between 2% and 15%.

For this reason, the FCA advised aspiring franchisees to be well-informed about the specifics of a business before signing a deal. Whether you are inclined to invest in a small or large franchise, extensive planning will be necessary on your part.

Expand Your Knowledge

FCA CEO Mary Aldred said that attending industry exhibits are a good way to be acquainted with several franchisors all at once. It can be difficult to call different phone numbers, schedule an appointment or browse through websites for information.

On the contrary, Aldred said that many of the 1,100 franchise businesses in Australia usually take part in exhibits. These events let you maximise your time and you get to be protected under a “seven-day cooling-off period from signing,” which allows anyone to back out of an agreement if they had a change of heart, according to Aldred.

A well-known franchise brand entails a significant investment, although paying large fees does not guarantee the survival of your business. Likewise, a low-cost franchise is not always doomed to fail, so think carefully if being a franchisee is a good fit for you.

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