Buying a Franchise: 3 Essential Steps to Set Yourself Up for Success

Anita du Toit • September 4, 2025

Thinking about buying a franchise? You're not alone. Franchising offers a powerful way to step into business ownership with a proven model, brand recognition, and ongoing support. But before you dive in, there are three critical things every aspiring franchisee must know to make a smart, profitable decision.

Whether you're exploring fast food, fitness, or retail franchises, this guide will help you navigate the process with confidence.

1. Do Your Homework: Research the Franchise Thoroughly

Before signing any agreement, it's vital to understand the franchise inside and out. Ask the franchisor key questions like:

  • How long does it typically take for a franchise location to break even?
  • What is the average return on investment (ROI)?
  • What are the terms of the franchise agreement?
  • How is the royalty fee structured?

But don’t stop there. Speak directly with current franchisees to get real-world insights:

  • How long have they been operating?
  • What challenges have they faced?
  • How many employees do they manage?

This kind of due diligence helps you assess the franchise’s viability and whether it aligns with your goals and lifestyle.


2. Know the Costs: Budget Beyond the Buy-In

Buying a franchise isn’t just about the initial investment. You’ll need to understand the full financial picture, including:

  • Total startup capital required
  • Upfront cash contribution
  • Ongoing royalty and license fees
  • Estimated monthly operating expenses

Hidden costs can derail your business if you're not prepared. Make sure to factor in marketing fees, equipment purchases, and staffing costs. A detailed financial plan will help you avoid surprises and stay profitable.


3. Understand the Commitment: It’s More Than Just a Business

Franchising means adopting someone else’s business model—and that comes with responsibilities. To succeed, you must:

  • Fully understand the franchise’s operational systems
  • Be ready to follow brand standards and procedures
  • Dedicate time and energy to managing the business
  • Build a strong relationship with the franchisor

Remember, the franchisor is your partner in success. Their expertise and support can be invaluable, but only if you’re committed to working within their framework.



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