You might be a car
salesman looking to branch out on your own, or a small-business owner wanting
to enter a new market. Whatever your situation, it’s worth looking into a car
or automotive franchise if you’re considering franchise opportunities.
Auto parts franchises and car dealership franchises are some
of the most popular types of franchise in the country, second only to
restaurants.
Reasons to consider
an automotive franchise
If one thing in life is certain, it’s that there will always
be demand for cars. In the future, that could be a flying car or a
hydrogen-powered car, but a car nonetheless. Owning an automotive franchise
gives your business the clout of a recognizable brand name and draws customers
in need of a vehicle or parts and service for their vehicle.
What to look for
When looking for a franchise opportunity, there are a few
things to consider. First, you should look for a well-known name such as
Chevrolet, Toyota, Valvoline, or Big O Tires. Chances are if you’ve heard of
the business, your potential customers have as well.
In addition to a name, you’ll want to read reviews of the
company to get a feel for its reputation. Review sites like Google and Yelp can
give you a good idea whether people tend to like a business or hate it. You can
also look at sites like franchise.com and entrepreneur.com to see which
franchises they recommend.
Can you afford it?
Before you can purchase a franchise license, you need to
check with your chosen business to see what their requirements are. For
example, Meineke requires franchisees to have a net worth of at least $250,000,
liquid assets of at least $110,000 (non-borrowed), and a credit score of 700 or
higher. To get your Meineke franchise off the ground you’ll need to invest
around $250,000-$300,000.
The costs make owning a franchise impossible for many
would-be business owners. But if you meet the qualifications put forth by your
chosen brand you could soon start making a profit due to the name recognition and
reputation of your business.
Is there demand?
The last thing you want to do is get stuck with a franchise
that doesn’t have a customer base in your area. If you live in a large city
where most people use public transit, an automotive franchise might not be the
best option for you. Likewise, if you live in a small town with family-owned automotive
businesses, consider whether you want to risk stealing their business and
causing bad blood between you.
Look at your market and the potential competition within it.
If there are a lot of automotive franchises in your area providing the same
service you want to, you might have to move to another area where there’s less
competition if you want to be successful.
Does the business
have success with franchising?
Look at whether other franchisees have been successful. You
can ask them directly or look for answers online. You don’t want to end up
investing in a brand that hasn’t been very successful with franchising its
business.
What restrictions are
there?
Before signing anything, make sure you understand the rules
and restrictions put forth by the business you’re franchising. You might find
that they require you to keep certain opening hours, prices, and products in
stock. Make sure you agree with these terms before making a final decision.
Whether you want to become a franchise owner of a car dealership, an automotive service center, or a car parts store, make sure you do your homework before you sign on the dotted line.
Sources: Canon, https://www.pointfranchise.co.uk/I-98-car-automotive-franchise/
The News Wheel is a digital auto magazine providing readers with a fresh perspective on the latest car news. We’re located in the heart of America (Dayton, Ohio) and our goal is to deliver an entertaining and informative perspective on what’s trending in the automotive world. See more articles from The News Wheel.
