Low-Cost Franchises | How-to Guides for running your business from Business.com

Money is an important concern in starting any business. Franchises are no different. They require cash for real estate, personnel, marketing and merchandise—just like every business does. But if you think that a franchise is out of your financial reach, you should think again. There are scores of successful, low-cost franchise opportunities—including those listed below—that ambitious entrepreneurs can take advantage of with an initial investment of less than $50,000.

Still, if you’re shopping for a franchise: Buyer, beware. Cost is not the same as value, and what matters isn’t always what you spend, but rather what you make. Apart from your initial investment, take into account ongoing costs that must be paid to your franchisor, including:

1. Franchise royalties
2. Marketing fees
3. Required purchases and services

Action Steps
The best contacts and resources to help you get it done

Automotive

Cars are big business. After all, everyone needs to be able to get from point A to point B. If you're good with your hands and have a passion for carburetors, undercarriages and tailpipes, an automotive franchise might just be your thing.

I recommend: Top-rated, low-cost automotive franchises include M.A.R.S. International, an automotive appearance reconditioning company; Affiliated Car Rental, an affordable car rental franchise; and Colors on Parade, which provides automotive appearance services.

Financial Services

As long as people are making and spending money, they'll need folks to manage it for them. Financial services franchises are the perfect opportunity for math whizzes, stock market mavens and entrepreneurial CPAs.

I recommend: Top-rated, low-cost financial services franchises include a host of income tax preparation and filing outlets, such as Jackson Hewitt Tax Service, Liberty Tax Service, Instant Tax Service, ExpressTax, Colbert/Ball Tax Service and Tax Centers of America.

Foodservice

In today's on-demand world, foodservice franchises are the king of the crop. Everyone needs to eat, and fewer people are finding the time these days to feed themselves. That means there's plenty of opportunity for enterprising foodies who want to strike out on their own.

I recommend: Top-rated, low-cost foodservice franchises include Hot Stuff Foods, a quick-service food concept that focuses on partnerships in non-traditional markets, such as convenience stores; Candy Bouquet, a confection shop that creates floral arrangements with candy instead of flowers; Pizza Inn, which offers quick-service pizza, pasta and chicken wings; and Cuppy’s Coffee, a drive-thru franchise that serves coffee, lattes and smoothies.

Health and Fitness

It's not important what the next big diet fad is. What's important is that there is one—and there always is. Consider taking advantage of trends in health and wellness, then, with a franchise that'll keep both your bottom line and your customers fit.

I recommend: People's need for self-improvement isn't likely to wane anytime soon. Top-rated, low-cost fitness franchises include Curves, a women’s weight-loss center; Jazzercise, which provides dance and exercise classes; My Gym Children’s Fitness Center, which offers on-site fitness programs for children; StrollerFit, which offers fitness products and classes for parents and their babies; and Anytime Fitness, a 24-hour gym franchise.

Home Improvement

For the average person, it's hard enough to find time for eating and sleeping, let alone for cleaning or remodeling the house. That's why more and more people are hiring professionals to take care of their homes for them. If you're handy around your house, consider buying a franchise that lets you be handy around someone else's, too.

I recommend: Top-rated, low-cost home improvement franchises include ChemDry, which provides carpet, drapery and upholstery cleaning; Merry Maids, a residential cleaning service; Interiors by Decorating Den, an interior decorating service; Rooter-Man, a plumbing company; House Doctors, a handyman and home repair company; and Service Team of Professionals, which offers disaster restoration services for homes.

Retail

Apparel, gifts, knick-knacks, toys. With retail, your options are limitless. Decide what you love to buy and ask yourself if you'd like selling it, too. Chances are good that there's an affordable retail franchise out there somewhere with your name on it.

I recommend: Top-rated, low-cost retail franchises include Merle Norman Cosmetics, a cosmetics studio; Snappy Auctions, an eBay consignment store; and Wireless Dimensions, which sells wireless accessories.

Services

If you like helping people, consider purchasing a service-oriented franchise. There are a number of opportunities available to you: You can teach people a new skill, help them plan an important event or just make them feel better about themselves with some much-needed personal attention.

I recommend: Top-rated, low-cost service franchises include tutoring services like Kumon Math & Reading Centers and Club Z In-Home Tutoring Services; travel agencies like Results Travel and Cruise Planners Franchising; and other service-minded businesses, like The Growth Coach, which provides small business coaching services, and TSS Photography, which provides youth, school and event photography.

Technology

Today's consumers are nothing if not plugged in. The market is therefore ripe for tech-savvy businesses that can help people do everything from install their electronics, use their personal computers and build their company Web sites. If you're good with wires, look for a franchise that can truly spotlight your skills.

I recommend: Top-rated, low-cost technology franchises include computer repair and consulting companies such as Computer Troubleshooters, Rescuecom and Friendly Computers.

Tips & Tactics
Helpful advice for making the most of this Guide

Franchisors are required to disclose all fees in the Uniform Franchise Offering Circular (UFOC). There should therefore never be hidden costs; what you read is what you should expect to pay.
Don’t only consider cost; consider value, too. Low-cost franchises are not always high-value business ventures and franchise opportunities with higher investment needs may prove worth the extra dough in returns.
No matter how affordable, don’t assume that you’ll be able to borrow the entire start-up budget for your new franchise; be ready to contribute your own cash investment, as well.
Potential franchisees-turned-bargain hunters should ask franchisors if they allow "silent" partnerships, in which a franchisee with experience and knowledge teams up with an investor who can fund the operation.
If you're looking for a deal, search for franchisors who are partnering with local governments and redevelopment agencies to attract businesses that will strengthen local economies; such arrangements often translate into incentives for franchisees.

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