When you mention franchising, the first thought of many people is fast food restaurants, cafes, quick service restaurants or sometimes even petrol stations!  Most people think about the retail or food sectors in franchising.

But, what about the service based franchises?  Sometimes I think we are the forgotten third child in the franchising world, but at the same time, I kind of like that because then when people discover us, it is like they have found a magic treasure that no one else knows about.

What makes a service based franchise so good….

  1. No rent – no physical presence need, no shopfront, no massive lease that you are responsible for which will eat away at your profit margin.


  1. Local business – people get to do business with YOU and your team. They know who the local business owner is.  This build great reputation which leads to awesome word of mouth business (the best form of marketing there is)


  1. Need, not want – generally most service based franchises provide a service that is needed by their customers. This will help in downturns in the economy (because they do come around on a cycle) that your business will still be strong because it is a service that people need, not something they just want.  If money is tight, people stop spending on things they simply want, but keep buying the things they need.


  1. Lower entry investment – because you don’t have to do a massive shop fit, lots of signage, chairs and tables and lots of equipment, the entry price of a service based franchise business has a lower entry cost, making business ownership more accessible to more people, not just those that have lots of money already.


  1. No experience required – for many service based franchisees (except a few trade based ones) you don’t have to have any experience or qualifications. With the right training, anyone can learn to do the work of the franchise business.


  1. REPEAT business – this is the unknown magic that is often overlooked by many. If you build great rapport with your clients, do good work and remind them to use your service again, you will build a strong customer base that keeps getting you in to do the service you provide for them, on a regular basis.  It is six times cheaper to keep an existing customer and get them to buy from you again than it is to get a new one.  Service based franchises basically have this built into their business, which will save you time and dollars on marketing in the future.


  1. Low ongoing costs, high profit margins – if you owned a café, a lot of your expenses would be on food… that can go off or get wasted! Imagine that coming off your profit margin.  In a service based franchise, with no major cost of sales (eg. products), no lease, the ability over time to reduce marketing expenses, the ability to work on your own without staff or maybe hiring low numbers of staff (unlike a café that needs a lot of staff to cover 7 days a week, 24 hours a day), you will find that your running costs ongoing will be low which means your profit margin will be high.


So I might be totally biased on which is the better sector of franchising to get in to, but the facts speak for themselves…. Serviced based franchisees are pretty awesome!