10 Essential Factors to Consider Before Buying a Franchise
You’ve made the decision to take that leap of faith and become a franchise owner. It’s an exciting time mixed with, perhaps, a bit of anxiety. The trepidation comes from wanting to make the best business decision and do something you enjoy while getting a strong return on your investment.
Franchising is a Good Opportunity
Choosing to become a franchisee is a great move for aspiring entrepreneurs. It allows you to enjoy the benefits of business ownership without starting from scratch. For your investment, you will gain access to a proven business model that you can replicate for profit.
So here comes the hard part. How do you determine which is the best franchise for you? After all, there are many choices out there, with close to 800,000 franchises in the United States alone. To help you evaluate your best option, here are the 10 most important factors to consider before buying a franchise.
- Leadership Team – At the end of the day, you need to get along with and trust the people that are going to support you in this business. A good franchisor will offer support and training and make brand expectations clear but will trust franchisees to manage and oversee their business.
- Growing Industry – You want to work with a brand that provides a good or service which is in high demand. According to the American Massage Therapy Association, massage is an $18 billion industry that’s growing continually as adults prioritize self-care and their overall health. Massage is no longer viewed as a luxury or “treat.” At MassageLuXe, we believe a massage is not an indulgence, but an essential component of overall wellness.
- Turnkey Business – A franchise is designed to provide a potential business owner with everything needed to open a business. This includes guidance and training from the franchise. MassageLuXe provides world-class training and ongoing support from site selection and buildout to the grand opening and beyond. MassageLuXe franchisees have access to state-of-the-art management software that is custom to our brand. This software allows franchisees to coordinate all aspects of their business, which sets their operations and client experience up for success.
- Profitability – You need to know how to run this new business venture and what the earning potential is. You have made a large investment with your time and money, and you want to see a return. Learn about costs like the franchise fee and royalties. Understand the profit margin of the franchise you are considering. On average, each MassageLuXe location produces more than 20 percent in profit margin annually. Our initial franchise fee is $42,500, and the estimated initial cost to open a MassageLuXe day spa franchise varies from $339,000 to $571,000.
- Success Rate – The success of your franchise is not just numbers in the FDD — the Franchise Disclosure Document, which provides prospective franchisees with information about the franchise. Being passionate about your new business venture is essential to success. Find a franchise that aligns with your vision. If health and wellness are important to you, then being a part of the MassageLuXe brand is a good match.
- Brand Recognition – The strength of the franchise brand is important to your future success. When a business name is highly recognizable and trusted, franchisees can count on a customer base before opening their doors. That’s the recognition that comes with MassageLuXe. Customers can depend on a modern, relaxing, high-quality and cohesive spa design and experience, no matter which location they visit.
- Marketing – As a potential franchisee, it’s in your best interest to look for a franchise that provides marketing and advertising plans for stores to utilize. One of the benefits of owning a franchise like MassageLuXe is that we work with professional marketers to promote our locations across the country. Your franchise directly benefits from lower marketing costs and increased marketing reach. How the brand is promoted brings customers in the door, the business model and their experience keep them coming back.MassageLuXe drives reliable spa revenue through its membership-pricing model. Gift cards are another revenue stream; we drive additional customers into the spa through gift-giving. MassageLuXe carries a variety of facial, waxing, and massage products and service add-ons that complement in-spa services for guests and increases revenue potential for spa owners.
- Territory Exclusivity – This is a very important component for your success as a franchisee. When you have an exclusive territory, it means no other franchisees within the brand can open another location in your designated territory. That’s important at MassageLuXe, as we want each franchise location to be a successful, cornerstone business.
- Multi-Unit Availability – This is another important element to consider when choosing a franchise. Perhaps you want to increase your profit potential by opening additional locations. At MassageLuXe, we offer attractive pricing for franchisees who want to open multiple locations.
- Peer Networking – Sharing knowledge among the brand can be an important tool for you as a franchisee. Getting advice about everyday operations from existing franchisees is invaluable. When you buy into MassageLuXe, you also buy into a network of experienced entrepreneurs who can serve as excellent resources.
MassageLuXe encourages potential partners to talk with current franchisees. Brands that don’t recommend these discussions signal a red flag. Other potential red flags include franchise turnover or financial issues, which is why it’s vital to do your homework.
We are here to answer any questions you may have about MassageLuXe.
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