|
As
a professional small business broker and franchise sales
consultant I am often asked what types of franchise
opportunities are the most profitable to start and own. From my
experience there are a few common factors or characteristics
that give some franchise business models a definite edge or
advantage when it comes to the ability to consistently produce
high profit margins. Some of these advantageous characteristics
include having low overhead expenses, limited competition, and
not offering a commodity type product or low barrier services.
Below are a few franchise opportunity categories that share some
of these characteristics and are generally regarded as having
the right stuff to be very profitable.
Financial
Services Franchises:
Franchises that
offer financial related services such as income tax preparation,
accounting, and consumer insurance services generally enjoy very
high profit margins for a number of reasons. This includes low
overhead expenses because of generally lower staffing
requirements and no absolute need to rent high traffic (and
expensive) retail space. And because they offer professional
type services the barrier to entry is a little higher than
starting the average home cleaning or janitorial franchise which
helps limit competition. And last but not least financial
franchises like insurance and
income tax
franchises offer services that have the ability to generate
repeat and residual income which can do wonders for the bottom
line.
Medical and
Health Care Franchises:
Medical and
health care related franchises are well positioned to reap the
benefits of an ever expanding market due to major and favorable
demographic trends such as the inevitable aging of the baby
boomer population. Traditionally
health care franchises that offer services like assisted
living, senior home care, and lab testing have very high profit
margins and are generally considered recession resistant. These
factors bode well for maintaining high profit margins for these
generally non-discretionary services that will always be in
demand for the foreseeable future.
Home Based
Franchises:
Some of the
most highly profitable small businesses I have ever worked with
as a professional business broker were home based. In my opinion
the benefit of not having the expense of a monthly lease payment
can not be overstated in terms of bottom line profitability.
Other profitable advantages of owning a home based franchise
business include no daily commuting or travel expenses, as well
as certain tax advantages that could put more money in your
pocket at the end of the year. Be sure to consult with an
accountant or CPA for more details about the tax advantages of
starting a home
based franchise or business.
Internet
Franchises:
Starting an
Internet franchise business offers many advantages in terms of
setting the stage for being very profitable. This
includes the fact the most Internet franchise opportunities
being offered today can easily be operated from a small home
based office with just an internet connection, computer, desk,
and a chair. Consequently your overhead expenses will be much
lower than that of a typical brick and mortar retail franchise
business because there are no lease expenses or expensive
equipment and inventory expenses. And generally most Internet
franchises being offered today are designed to be owner operated
so there are no expensive staffing requirements either.
About Author:
Ray Haiber has
12 years experience as a professional business broker and
franchise consultant. You can view
franchises for sale across the USA here. Go here to research
affordable and
low cost franchise opportunities for sale including home
based businesses.
|
