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UGLOBAL IMMIGRATION MAGAZINE
These questions are a few of the important ones that the
franchise business investor needs to ask in order to help
determine which franchise opportunities best fit his or
her profile.
CHARACTERISTICS OF
THE FRANCHISE BUSINESS INVESTMENT
After the investor goes through the aforementioned points to
figure out his own individual profile and goals, he is ready to
begin looking at potential franchise business investments.
Universal characteristics of recommended franchise
business investments are recurring revenues, high profit
margin, a strong management team, available locations and
accepting foreign nationals on investor visas.
Recurring revenue is defined as ongoing income that the
business receives from clients. This could be a nail salon
that 90 percent of its clients visit monthly or a barbershop
where vast majority of clients visit every six weeks. Recurring
revenue ensures stability in the business and the sales team
can focus on building its base of customers.
Many of the most profitable businesses have high profit
margins. An example would be an ice cream shop that costs
10 cents to produce a cup of ice cream and sells the same
product for $5. Ideally, the business has both recurring
revenue and a high profit margin, as a high profit margin
alone often comes with high fluctuations in daily, weekly and
monthly sales. This makes the business less predictable and
can create issues, especially when fixed costs are high.
A major reason why investors enter into franchising is
the initial and ongoing support received by the franchisor
or operating partner. Franchisors help franchisees with
a variety of aspects, including: assisting in site selection
and development; training; assisting with hiring of
personnel; leading marketing campaigns; maintaining
relationships with suppliers; and offering ongoing operational
support. Many Grenadian E-2 visa investors require a day-to-
day manager provided by the franchisor.
The area where the franchise unit is located is another
integral part of the process when deciding on the right
franchise investment. Rent and other operating expenditures
might be too costly and risky for the specific business in
a given area, or the territory might be sold out. That is why
it helps to be flexible when choosing the area to open and
operate the business. Parts of California, New York and Illinois
are extremely cost prohibitive to starting a business.
Roughly 30 percent of franchises do not accept foreign
nationals or non-green card holders as franchisees.
Additionally, many of the franchises that do not accept
that foreign nationals are among the most established and
well-known brands. Many of the large franchise brands like
Burger King, Pizza Hut and Taco Bell might allow foreign
national ownership but require a five- to 10-unit development