Originally Posted By: Blaine Wiley
This post was automatically imported from our archived forum.
I have owned a franchise inspection company, and am now independent.
The benefits to owning a franchise company are that you get training, a reporting system, continuing education, a little bit of support, marketing materials at a greatly reduced cost, and depending upon the franchise you might get discounted E&O insurance.
The drawbacks are that you have to do things their way, or at least within the policies of the franchisor, you will spend 6 to 7% in royalties, and 3 to 4% off of your gross revenue for royalties after spending many thousands to buy the franchise, the franchisor will require you to send in all of your financial records annually, and you will have to work within your specified territory.
My preference is at this point to be independent. I am finding that starting as an independent the second time is just as difficult as with a franchise. I had to come up with my own marketing materials, have my own software for reporting and accounting developed (there are several commercially available products which are good, they didn't meet the quality of reporting I wanted to hand out), make a report binder, etc. If you are starting out for the first time, these will be difficult, but not impossible.
When I started with the franchise it all together cost me about 25K to get going (in 1995). Without the franchise, it has cost me about 9k to get going.
So, to make a long story longer, and since this is free advice it's probably worth about that much, weigh your options and your bank accounts carefully. If you are an average inspector, it will take you 12 to 18 months to get going either way, if you are far above average, maybe 9 to 12 months.