7 IN­COME-GUAR­AN­TEED FRAN­CHISES

Inside Franchise Business - - Contents -

For an ex­tra level of fi­nan­cial se­cu­rity check out these brands.

Brands that sup­port fran­chisees with a cer­tain level of in­come can be an at­trac­tive propo­si­tion for first-time busi­ness own­ers.

Launch­ing a busi­ness is al­ways stress­ful, and one of the big wor­ries is try­ing to en­sure a steady cashflow and cope on a fluc­tu­at­ing in­come. Some fran­chises of­fer an easy way in by sup­port­ing fran­chisees with a guar­an­teed in­come.

As well as eas­ing the stress load, it gives new fran­chisees the free­dom to fo­cus their en­er­gies on build­ing up their busi­ness.

Here are seven brands that pro­vide a fi­nan­cial safe­guard:

AUSSIE POOCH MO­BILE

Aussie Pooch Mo­bile of­fers a guar­an­teed in­come for the first eight weeks in its pre­mium fran­chise pack­age, help­ing give new fran­chisees peace of mind while grow­ing their busi­ness in the ini­tial launch pe­riod.

“Ob­vi­ously as com­pany we are con­fi­dent in our sys­tems and know how our busi­ness grows, but a new fran­chisee does not nec­es­sar­ily share the same be­lief and con­fi­dence,” says founder Chris­tine Tay­lor. “The guar­an­teed in­come helps give the fran­chisee the con­fi­dence that we will be do­ing ev­ery­thing we can to help them grow their busi­ness.”

Run­ning for 20 years, it is an es­tab­lished part of the fran­chise of­fer. The guar­an­teed in­come is $600 ex­clud­ing GST each week for eight weeks. If a fran­chisee earns $400 in a week, the fran­chisor pays $200; if they earn $599, they’ll re­ceive the ex­tra $1.

The money is placed on the fran­chisee’s Aussie Pooch Mo­bile ac­count for them to use to pay for stock and roy­al­ties.

“We do as much ad­ver­tis­ing and mar­ket­ing as pos­si­ble lead­ing up to and in­clud­ing the first few weeks of the fran­chisee’s launch to help them reach a point where they are earn­ing more than the guar­an­teed in­come as quickly as pos­si­ble,” says Tay­lor.

“The guar­an­teed in­come demon­strates to peo­ple com­ing into our busi­ness that we back our sys­tems and know how to grow the busi­ness. It also shows them there is a real in­cen­tive for us to help them.

“Our goal is to have the fran­chisee earn­ing the guar­an­teed in­come them­selves from week one.”

A stan­dard fran­chise pack­age is avail­able for those who do not want or need to rely on a guar­an­teed in­come.

CAFE2U

“We are so con­fi­dent our Cafe2U busi­ness model will help fran­chise part­ners build the busi­ness to a min­i­mum of $500 a day rev­enue in the first two weeks, that we will cover the dif­fer­ence if they don’t,” says Ge­orge An­ge­lis, gen­eral man­ager mo­bile at par­ent com­pany Re­tail Food Group.

“This Ac­cel­er­a­tion Pack­age is our point of dif­fer­ence. Not only are fran­chise part­ners of­fered sup­port ev­ery step of the way dur­ing their busi­ness launch, they are guar­an­teed their in­come will build to a min­i­mum of $500 a day, and they will be left with a strong cus­tomer base as a plat­form for their busi­ness to grow.”

This of­fer has ap­plied for Cafe2U fran­chisees since 2009. Re­turn on in­vest­ment is im­por­tant for new fran­chisees, says An­ge­lis. They want to know they will make a fair in­come for their in­vest­ment and for the amount of ef­fort they put into the busi­ness.

For 90 per cent of fran­chisees, it is their first busi­ness. Many have never made an es­presso cof­fee pre­vi­ously. More than 98 per cent of fran­chisees achieve or ex­ceed the level of suc­cess they aimed for be­fore start­ing their busi­ness.

HIRE A HUBBY

CEO Bren­dan Green wants ev­ery Hire A Hubby fran­chisee to be as suc­cess­ful as pos­si­ble. “Be­ing able to of­fer an in­come guar­an­tee is just one of the many tools we pro­vide to new­com­ers so they can set up their busi­ness and make it flour­ish,” he says.

“Hav­ing an in­come guar­an­tee pol­icy gives the fran­chisee peace of mind, es­pe­cially in the early days when there are a lot of un­knowns.”

A few se­lect fran­chise pack­ages of­fer a $125,000 in­come guar­an­tee. This is de­signed to be a guide and help in the ini­tial stages of the fran­chise busi­ness. Hire A Hubby pro­vides a sup­port struc­ture in terms of leads, guid­ance and train­ing to give new fran­chisees the best op­por­tu­nity to reach this in­come level in their first year.

If the level is not reached in the spec­i­fied time frame with all con­di­tions hav­ing been met, the fran­chisor will make a pay­ment and of­fer fur­ther help to achieve these lev­els.

Since the in­come guar­an­tee was in­tro­duced last year, the in­ter­est in join­ing Hire A Hubby has in­creased. There are now more than 300 fran­chises across Aus­tralia.

“The of­fer­ing is a key sell­ing point be­cause for so many peo­ple the big­gest leap of faith in tak­ing on a new busi­ness is the fear of the un­known and of some­thing not work­ing out,” says Green.

IN XPRESS

In Xpress fran­chisees en­joy the ben­e­fits of a re­cur­ring, com­pound­ing in­come busi­ness. The in­come guar­an­tee of­fers new fran­chisees the chance to fo­cus on the long-term suc­cess of their busi­ness know­ing their day-to-day fi­nance com­mit­ments are cov­ered.

In­tro­duced two years ago, the con­cept of­fers new fran­chisees a guar­an­teed in­come of $1000 +GST weekly for the first six months. If a fran­chisee earns $300 in their first week, In Xpress will “top up” an ex­tra $700.

While the op­tion does not suit all fran­chisees, there are other busi­ness-build­ing op­tions at In Xpress. For ap­proved can­di­dates there is the Young Gun pack­age, a full grad­u­ate train­ing op­por­tu­nity and men­tor pro­gram. The exclusive pro­gram of­fers a six-month train­ing in­tern­ship with up to 50 per cent dis­count on the nor­mal pur­chase price of a fran­chise.

LADIES RUN­NING ERRANDS

Just months af­ter launch­ing its fran­chise model, the Ladies Run­ning Errands ser­vice in­tro­duced an in­come guar­an­tee.

“We found we were at­tract­ing peo­ple to our fran­chise sys­tem who were leav­ing sta­ble, long-term em­ploy­ment in favour of the flex­i­bil­ity, earn­ing po­ten­tial and sense of own­er­ship de­rived from self-em­ploy­ment. We be­lieve the in­come guar­an­tee pro­vides pre­dictable in­come and cashflow dur­ing this huge tran­si­tion,” says fran­chise op­er­a­tions man­ager Zoe Voy­anas.

The in­come guar­an­tee pro­vides a set weekly amount to the fran­chisee. The fran­chisee needs to ful­fil their lo­cal mar­ket­ing obli­ga­tions and com­ply with the op­er­a­tions man­ual. If their weekly rev­enue falls short of the guar­an­tee level, they re­ceive a top-up from the fran­chisor.

The fran­chise in­vest­ment is from $19,990 + GST, with the in­come guar­an­tee start­ing at $400 a week for 12 months.

Ladies Run­ning Errands has found the in­come guar­an­tee ef­fec­tive in al­low­ing po­ten­tial fran­chisees to work out what their min­i­mum rev­enue will be and how long it will take for them to see a re­turn on their in­vest­ment.

OVEN VALETS

“We feel it is im­por­tant to hit the road run­ning. A happy fran­chisee makes good busi­ness, so an in­come guar­an­tee has al­ways been part of our of­fer,” says Oven Valets sales and mar­ket­ing man­ager Wayne Hunt.

Oven Valets fran­chisees work with home­own­ers, schools and busi­ness clients, pro­vid­ing a spe­cialised clean­ing and de­tail­ing ser­vice. The fran­chisor will pro­vide five jobs each week for an ini­tial eight-week pe­riod for most ar­eas. The av­er­age job value for the past six months has been $285.

YARRA VAL­LEY FARMS

Yarra Val­ley Farms guar­an­tees a min­i­mum $2000 weekly gross in­come for six months, with a top-up if a fran­chisee does not make tar­get.

How ef­fec­tive has it been in at­tract­ing new fran­chisees? “It’s a big ad­van­tage as it re­lieves the stress nor­mally as­so­ci­ated with start­ing a busi­ness. Fran­chisees can make money from day one,” says na­tional sales and fran­chise re­cruit­ment man­ager, Dar­ren Young.

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