When people look to start a new franchise and show an interest in those with a low starting cost, the first question is always, “Can this be as profitable as an expensive franchise?”. After all, as a franchise owner, you want your franchise to work hard to make money for you. Read on to find out more about how profitable low-cost franchises can be and some of the low-cost franchises that you can make the most money from.
Why choose a low cost franchise?
When people think about franchises, the first thing options that come to mind tend to be pub and fast food chains. However, there are plenty of franchise options that you can engage with at a much lower cost than you might have previously expected. These lower-cost franchises are the perfect route into the world of franchising, as you have relatively little risk compared to more expensive franchises.
You will lose relatively little in terms of initial spending in the event that you are unable to get off the ground, and running costs are also far lower. For anyone looking to invest in a first franchise in a low-risk way, there’s no better opportunity than diving into a low-cost franchise. However, this still leaves the question of whether or not your low-cost franchise can make a profit.
What makes a profitable franchise opportunity?
There are a few factors that can lead to an almost guaranteed level of profit. The factors you should look at when trying to develop a profitable franchise include:
High demand industries
Your best opportunity for building a profitable franchise is by working in an industry which always has a high demand. For example, the health and fitness sector offers a good opportunity for franchising as there are always people looking to improve their wellness. The same applies to cleaning franchises, as companies will always need to look presentable to their clients. These are factors that you can take full advantage of in the long term and will mean that you will never run out of potential to gain new customers while retaining your regulars.
Minimal running costs
Key to a profitable business of any kind is low costs, and low-cost franchises provide exactly that. For example, home-based franchises have very minimal costs as they allow the franchisee to work in their own property, from their own computer, with their own internet connection. This means that industries such as event planning, trip planning and even tutoring don’t have any significant ongoing costs, and almost all of the revenue you receive is profit. In this way, low-cost franchises likely have a much higher profit margin than those which require significant investment in raw materials in the long term.
Once you have found low-cost franchises with both of these features, you can see significant benefits in the long term profit potential of your franchise. From this point, you can choose an industry you would like to be involved in, as combining profit and enjoyment is vital to any successful franchise.
Which industries are suitable?
There are several industries that are well suited to profitable but low-cost franchises. Just some of these industries are listed below, along with some of the benefits of getting involved.
Starting a holiday planning franchise is a great way to get into the world of franchising as they offer work-from-home opportunities at an extremely minimal cost. Furthermore, demand in certain months is likely to lead to extreme levels of profit, with the summer months keeping you busy. You may need to budget in order to keep your income consistent, however, as months such as November (between summer but pre-Christmas) may see lower demand.
Dog walking franchises
Another affordable option with very minimal ongoing costs (in the form of treats, leads and harnesses), is a dog walking franchise. This is a great choice for any dog lover interested in independent work. This work is good fun but can require a significant amount of physical exercise. It may not be suitable for those with joint issues, but it’s an excellent opportunity for those looking for a step away from the professionalism of a home office.
Cleaning franchises allow you to engage with others whilst still working independently. Running costs are low, depending on your specific cleaning requirements, but the hours may be unsociable. This is because many companies will hire cleaning staff to work outside open hours. Cleaning franchises are simple to get started and offer excellent opportunities for those unafraid of hard work.