[Mick Kent]

If i wanted to franchise out a few rounds, what should i be asking as a return each month and also what is the going rate to sell a franchise for?
I was thinking of franchising 3 rounds out at £3/4k a month work each as have decided to not sell my domestic and to instead keep growing it the franchise or renting out route alongside growing commercial and canvassing.

I have rented work out in the past at 33 percent, from research looking at vin's info i can recieve 20 percent through franchising. What other differences are there between the 2 apart from the buying in fee?? As long as the work gets done and is always owned by me and making money from it ill be happy.

[richywilts]

franchising seems to be more long term and legally secure id say as a business decision id say defo the safer of the two options maybe not as much profit

[Walter Mitty]

If i wanted to franchise out a few rounds, what should i be asking as a return each month and also what is the going rate to sell a franchise for?
I was thinking of franchising 3 rounds out at £3/4k a month work each as have decided to not sell my domestic and to instead keep growing it the franchise or renting out route alongside growing commercial and canvassing.

I have rented work out in the past at 33 percent, from research looking at vin's info i can recieve 20 percent through franchising. What other differences are there between the 2 apart from the buying in fee?? As long as the work gets done and is always owned by me and making money from it ill be happy.

I have never done this but from what I've read on here and elsewhere, with franchising it would be easier to stay below the VAT threshhold as your business turnover consists of the *royalties* from the franchisees rather than their total turnovers.  However, if you are staying on the tools and franchising work out, you would probably pass it anyway.  It can be useful if discontinuing the physical work yourself though.
Perhaps you are VAT registered already - making my post irrelevant?

[Smudger]

Maybe wrong but I think in the case of a franchise you don't own the work, you get a royalty/fee for the work they do, the idea is brand awareness you provide everything needed such as leads, tech support, training etc..  How much would depend on what your charging, they have a can with your branding on, and hopefully they do a good job and grow an Independant biz.

Renting means the work is always yours to take away as and when you like (within reason)

Darran

[David Kent @ KentKleen]

All the work covered by my  franchised vans belongs to me the franchisor. A franchisee can sell his franchise on but the work always belongs to the franchisor.  When renting out a round, if whoever is renting it is only cleaning this work in the eyes of the law you should be employing him.
Hope this helps.

[richywilts]

All the work covered by my  franchised vans belongs to me the franchisor. A franchisee can sell his franchise on but the work always belongs to the franchisor.  When renting out a round, if whoever is renting it is only cleaning this work in the eyes of the law you should be employing him.
Hope this helps.

not neccesarily its the same as when us window cleaners sub from commercial firms etc as long as the other window cleaner is self employed using own vehicle and tools etc you dont have to employ him to carry out the work

[David Kent @ KentKleen]

If you where only working for the one company and doing nothing at all of your own you need to be employed. If you 'sub' a round out and its the only source of income for whoever cleans that round they have to be employed.

[David Kent @ KentKleen]

The 'key' to all this is, making sure if you are not going down the franchise root that whoever 'subs' a round off you is also cleaning work of his own. Hope this helps.

[CleanClear]

If i wanted to franchise out a few rounds, what should i be asking as a return each month and also what is the going rate to sell a franchise for?
I was thinking of franchising 3 rounds out at £3/4k a month work each as have decided to not sell my domestic and to instead keep growing it the franchise or renting out route alongside growing commercial and canvassing.

I have rented work out in the past at 33 percent, from research looking at vin's info i can recieve 20 percent through franchising. What other differences are there between the 2 apart from the buying in fee?? As long as the work gets done and is always owned by me and making money from it ill be happy.

Your VAT bill.

[Mick Kent]

Cheers. Think im going to look into it further and get some pro advice about the whats and the if's.

[Smudger]

Kentclean- not going down the franchise route, but interested how it all works, I take it some one buys the franchise (an area) which comes with x amount of work, if they grow that round do you take more of a cut? Do you do all the advertising etc..
What happens if the franchisee drives the round into the ground and loses loads of customers ?

Darran

[Mick Kent]

Kentclean- not going down the franchise route, but interested how it all works, I take it some one buys the franchise (an area) which comes with x amount of work, if they grow that round do you take more of a cut? Do you do all the advertising etc..
What happens if the franchisee drives the round into the ground and loses loads of customers ?

Darran

Thats what im worried about

[Smudger]

Interested to know, as said franchiser gets a large lump of cash, then royalties, that's why this method is better for vat because the franchisee is Independant, I know it's not always clear cut and proper agreements are required and each franchise can be operated differently

Darran

[Ian Lancaster]

Maybe wrong but I think in the case of a franchise you don't own the work, you get a royalty/fee for the work they do, the idea is brand awareness you provide everything needed such as leads, tech support, training etc..  How much would depend on what your charging, they have a can with your branding on, and hopefully they do a good job and grow an Independant biz.

Renting means the work is always yours to take away as and when you like (within reason)

Darran

The terms of any business arrangement can be decided by the parties concerned.  In a franchised organisation the Franchisor 'owns' the work.  Franchisees pay for a licence to trade under the Franchisor's banner.  This may or may not include work supplied by the Franchisor to the Franchisee.

In our system the Franchisee is not under any obligation to generate business - we guarantee to provide as much work as he/she requires.  If the Franchisee is not performing well (i.e. not achieving a high enough percentage of the work available) we can re-allocate excess work to another Franchisee.

[Ian Lancaster]

Kentclean- not going down the franchise route, but interested how it all works, I take it some one buys the franchise (an area) which comes with x amount of work, if they grow that round do you take more of a cut? Do you do all the advertising etc..
What happens if the franchisee drives the round into the ground and loses loads of customers ?

Darran

Hi Darran,

Excuse my jumping in here.  We have found that having exclusive areas isn't the best way to operate.  As we provide all the work the Franchisees are not in competition with each other and so don't need protected areas.  If they acquire work themselves, this is still 'ours' - you can't have a Franchisee doing 'foreigners' - there would be a clear conflict of interest: why would he do your work if he was building a round for himself?  This is all controlled by the Franchise Agreement which is signed by, and binding on both Franchisor and Franchisee.


As for 'driving the round into the ground' - the Franchisor must monitor the Franchisee's performance on a 'real time' basis (made possible by cloud-based systems like Aworka).  The Agreement has specific sections which allow the Franchisor to discipline under performing Franchisees, or in extreme cases to terminate the Agreement.

[Smudger]

Cheers Ian that makes things clearer

I just wondered how new work was registered like walk ups etc..

Franchises are great esp. For the franchiser almost a no lose situation, interestingly for me is how do you circumnavigate the vat, because you are controlling the customers and work would this not be classed as one buisness ?

Darran

[Ian Lancaster]

New work from whatever source has to be recorded on Aworka.  Failing to do so is a breach of the Agreement.

Any Franchise which is properly set up and registered* is a separate business in it's own right.  We don't control the work - the Franchisee does his own scheduling, we provide details of people/properties wanting their windows cleaned.  The frequency is dictated by the customer as are payment methods, any special requirements etc.

Our job is to provide back-up services, ensure we have sufficient stock of spares, be available to help/advise in any problems and keep customer bases at the required level by ongoing marketing as necessary.

We monitor the work done and invoice the Franchisees for royalties.

*(Full instructions as to the correct way to do this to prevent HMRC classifying the Franchisor as an employer included in our Package  )

[Smudger]

Thx Ian for taking the time to post, very useful info

Darran

[David Kent @ KentKleen]

Hi Darren, mine all have there own version of George, they are required to keep me up to date with weekly reports on work done and new work (walk up's) aquired. It runs nice and smooth at the moment. As I grow my network I am going to have to look at a 'automated' system for reports etc all linked together.
I run a quality check system, I spend 1 afternoon a month 'checking' the standard of work that is getting carried out. Randomly selecting half a dozen customers. Customers love it, franchisees know about it and are kept on there toes. All helps with the 'professional' image.

[hasti]

Kentclean- not going down the franchise route, but interested how it all works, I take it some one buys the franchise (an area) which comes with x amount of work, if they grow that round do you take more of a cut? Do you do all the advertising etc..
What happens if the franchisee drives the round into the ground and loses loads of customers ?

Darran

Hi Darran,

Excuse my jumping in here.  We have found that having exclusive areas isn't the best way to operate.  As we provide all the work the Franchisees are not in competition with each other and so don't need protected areas.  If they acquire work themselves, this is still 'ours' - you can't have a Franchisee doing 'foreigners' - there would be a clear conflict of interest: why would he do your work if he was building a round for himself?  This is all controlled by the Franchise Agreement which is signed by, and binding on both Franchisor and Franchisee.


As for 'driving the round into the ground' - the Franchisor must monitor the Franchisee's performance on a 'real time' basis (made possible by cloud-based systems like Aworka).  The Agreement has specific sections which allow the Franchisor to discipline under performing Franchisees, or in extreme cases to terminate the Agreement.

Master Teacher on Window cleaning Franchisee (Ian) mind you not every one can run a franchisee very well.
To be a successful franchisor, you need to be a good leader, understand people well (your franchisee)