That’s often the million-dollar (or in this case, pound) question. What do you actually get in return for paying a franchise fee?

Joining any franchise requires a certain amount of capital investment to fund the development of your business as well as the upfront and on-going fees paid to the franchisor, which can often be significant.

It is therefore critical to determine whether the franchise offers value for money, but that is easier said than done.

In many cases, you’ll hear such fees justified as a cost for gaining access to a proven system; licence to operate under a well-known brand and in a certain territory; and/or to cover the training and support provided.

All of that is, of course, true. Sometimes, however, it’s hard to convey that price is what you pay, and value is what you get, especially as much of the value offered by franchisors is intangible.

So what value can a property franchise provide you with?

Owning assets has proven to be one of the most secure routes to wealth creation for decades, but take away the prospect of capital growth and the investment becomes much less appealing. This is why, when our founder Steve Bolton came up with a model that would ensure buy-to-let properties generated a significant income, he wanted to combine the security of property with the certainty of franchising.

He founded Platinum Property Partners to turn a complex, yet highly rewarding, strategy into a simple step-by-step system that others could follow to create a net annual income of £50,000 to £150,000 per year.

That was more than 10 years ago and only a successful track-record has followed.

The value for money Platinum offer their franchisees is in the vast amount of knowledge and experience of the sector. Just think

  • Would you know how to increase the rental income of a standard buy-to-let property by up to 40%?
  • Would you know what types of properties to buy and where?
  • How to cost-effectively refurbish, let and manage those properties?
  • When and what licensing and planning permissions are required?
  • Would you be ready to react to unexpected legislation and tax changes?

Add to this the constantly changing tax, planning and licensing legislation and the impact that external factors such as an economic downturn and Brexit could have on the performance of a property business and you can see how there are many costly mistakes to be made.

The tangible benefits

Many franchisees liken joining Platinum Property Partners to paying an insurance premium or a fast-track to success. They have also calculated that being part of the franchise has saved them thousands of pounds annually on the development and running of their property businesses, because Platinum has a dedicated network of suppliers, including accountants, builders, insurance providers and much more.

As a result, all 300+ partners now own more than 950 properties across 200 towns and cities throughout the UK that generate an average annual gross profit of £17,000 each.

The real question is, what is your perception of value for money?

Whatever franchise you’re considering, you always need to think about these two key factors - expected returns and how you will achieve these. Taking into account capital required and all associated costs of being a franchise partner, is the earning potential more attractive than if you were to start a similar business on your own?

What’s arguably more important though, is how much faster you’ll be able to achieve success and if some of the normal stresses and strains of starting a business will be somewhat alleviated by having someone there to support you.

Only you can decide if there’s a price you’re willing to pay for expert on-going education and support that will ensure you have a profitable and sustainable business for the long-term.

If you want to minimise the risks and maximise the return from both property and a franchise investment, get in touch with the team at Platinum Property Partners.

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Whether you’re keen to find out more about Houses in Multiple Occupation (HMOs), or want information on the latest lettings legislation, you’ll find it here on the blog.