Stay informed! Visit the SA Department of Health's website for COVID-19 updates:

Low Cost Franchises on the High Rise

News, Articles, Success Stories and Advice on Franchising
Low Cost Franchises on the High Rise

Low Cost Franchises on the High Rise

With tougher economic times and rising unemployment, there is increasing demand for good quality low cost franchise opportunities. In the US, low cost franchising is a fast growing category from franchised home healthcare to tax return services. There is a number of low cost franchise concepts in South Africa with much growth and diversification expected.

A low cost franchise typically requires an investment of less than R200 000 with low ongoing operating costs. Starting a business is tough – a franchise allows you to be your own boss with the support and branding provided by an experienced franchisor.

Low Cost Franchises: Earning Potential

Low cost doesn’t mean low return. There are low cost franchises that return a very healthy margin regardless of their initial costs. Many of these types of businesses operate from a home base saving on ongoing costs and reducing risk in those crucial first years. A low investment from the start means that you will have little or no debt to pay off from the start.

You need to consider the following factors before signing up:

  • Are you interested in the sector and do you have the skills be successful?
  • Does the franchise concept have an inherent advantage over a business you could start yourself?
  • Does the franchise have strong marketing channels to drive leads for your franchise?
  • Many low-cost franchises are service and not product-orientated – do you have the personality required to sign up and keep customers?
  • Do you have the space and facilities to run the business from home if this is required?
  • Does the franchisor offer an adequate level of support for the ongoing franchise fees paid?

While the initial investment may be low, you are still putting your hard-earned money to work. Speaking to existing franchisees can provide you with the best insights to the business health and prospects. Give the customer call centre and other marketing channels a whirl – if they don’t meet your expectations then perhaps give the opportunity a miss. Finally, beware of schemes offering cheap start-up costs with no franchise fees which will leave you stranded without any further support!

Current Low Cost Franchises

There are a number of great, affordable franchise opportunities to consider. From Kip McGrath Education Centres, Kumon and Sherpa Kids in the education sector to Classy Crete, The Gas Boys and Wilcote in the home improvement space. Contrary to popular belief, fast food franchises needn’t cost the earth – there are lower cost options such as The Fish & Chip Co. and King Pie.


Related Posts