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A huge number of aspiring entrepreneurs in Moscow, St. Petersburg and other regions Russian Federation dreams of opening profitable business by franchise.
If we evaluate the most profitable franchising of 2016 in terms of profitability, then it should be said that the vast majority of organizations that are among the top franchisors receive greater profits from their franchisees than from their branches. Mainly trading companies.
Currently, the most profitable franchises in the Russian Federation are the following:
Hookah club "Contrast" offers its franchisees a very profitable terms cooperation. The organization's activities are fully certified.
The Coffee Space coffee shop currently has tens of thousands regular customers, who are attracted mainly by the original design solution.
The branded clothing store for children “Artel” is only in its first year of franchising, but experts are already calling its franchise offer one of the most promising.
The Crocs shoe boutique is attractive to franchisees, first of all, due to the complete absence of royalties. The lump sum contribution is 1.5 million rubles.
LLC "Zhenavi" is a jewelry store. There is no lump sum fee, as well as royalties. The number of branches is currently more than 300. Own retail outlets more than 20. Buyers are required to have a premises whose total area must be at least 4 square meters. m.. It should be located on the 1st or 2nd floor shopping complex. Buyers must also have free financial means for purchase necessary equipment.
You can find a large selection of profitable business offers in the catalog of our website.
Starting your own business is a difficult and very risky process. A lot depends, first of all, on the personal qualities of the aspiring businessman, as well as on economic situation prevailing in the market. That is why many entrepreneurs begin their activities with franchising.
Let’s try to figure out what it is and whether it’s worth buying a franchise, based on real experience and reviews of franchises from people who took a risk and got down to business.
This is a type of cooperation in which one party (the franchisor) transfers to the second (the franchisee) the right to sell its goods and services or produce products under the franchisor’s trademark.
The franchisee pays a lump sum fee and royalties to the business owner, and he, in turn, fully controls the activities of the partner, dictates his terms to him, allows him to use his technologies and developments, and in some cases, supplies goods for sale.
In our country, the history of franchising began only in the late 80s and early 90s with the company producing and selling ice cream "". Abroad, the experience of buying franchises goes back more than one decade. This is one of the most common types of business expansion for promising companies.
In Russia, the most successful areas of franchising are:
Franchising of manufacturing companies, the development of which requires knowledge of complex technological processes, requires additional costs for materials and other production resources, as well as the availability of qualified personnel.
Franchising has many advantages, especially for people who are taking their first steps in business.
Let's take a closer look at the main advantages of the franchise:
Like any phenomenon, franchising has its drawbacks. Before you set off on a free voyage, you need to learn about all the pitfalls that await you along the way. Reviews about the franchise from our entrepreneurs are very contradictory, and there are also reasons for negative experiences.
One of the main obstacles may be the lack starting capital for a down payment. Often, a lump sum contribution is more expensive than investing in your own business. In addition, the matter is not limited to paying a lump sum fee - royalties must be paid regularly.
Another drawback that some entrepreneurs note in their reviews of the franchise arises, oddly enough, from its advantages. Constant control by the business owner can limit the independence of the franchisee. This is due to the strict terms of the contract, requiring full compliance with all requirements for the quality of goods and services.
No matter how things are going for you, it will be impossible to go beyond your business plan. For ambitious entrepreneurs, this can be a big problem.
The reputation of your business will depend on what it is like with the franchisor. Therefore, when choosing a company, you should try to get complete information about it before agreeing to purchase a franchise or choosing a world-famous company such as or.
“If you don’t have any experience in business, and you still don’t have enough life, your pocket is empty, but your ambitions don’t let you sleep peacefully at night, then feel free to choose franchising. I took a risk and bought a franchise fromSubway, and within six months opened a second location, and then several restaurants in neighboring cities.SubwayHe perfectly helps to cope with the first difficulties, guides and very strictly controls all processes. For those who are used to working and being responsible for their work, this is the best choice. You will gain invaluable experience, and within a few months you will be able to recoup all expenses.”.
Franchises in the field of children's leisure, as well as sports or musical and aesthetic education, are very popular. Franchises of sports and dance clubs allow many people to realize their dreams not only about business, but also to demonstrate their creative, pedagogical and intellectual abilities.
However, there are also negative opinions. Very often this is due to the fact that people buy a franchise from companies that little is known about in the region. Because of this, it is much more difficult to attract customers; competent implementation is required promotions, a lot depends on the person who owns the business:
“My friend purchased goods from a very well-known brand in this country abroad. She liked the quality of the clothes and the price. She decided to buy their franchise and open a store in her city. However, no one here has heard anything about such a brand and, despite good product, support management company, business did not go well. Therefore, you should not get involved with unknown brands - it is better to follow the already beaten path and buy a franchise from a well-known profitable company.".
Creating a franchise business means entering the market under someone else's brand, which the consumer already knows. The main advantage of a franchise is that you get a “ready-made business” and avoid many of the risks associated with starting a business from scratch.
Another obvious plus is that, despite the economic crisis, the franchising sector in Russia is growing. In 2016 on Russian market, according to CEO magazine, there are about 1,400 franchises: 10% more than last year.
Today the most profitable franchises- in the areas of catering and retail trade.
The most famous franchise chains in public catering are Baskin Robins, Dodo Pizza, Subway and Stardogs. The payback of such a business varies from 9 months to 1.5 years.
The world's largest chain of fast food restaurants, Subway, has opened 644 companies in 141 cities in Russia. The franchise is growing quickly, since opening one Subway outlet requires a minimum of resources: the eateries do not have a hot shop, so they are launched economically and quickly.
Clothing, shoe and perfume stores, on the contrary, are less profitable. Given the crisis and the need for large investments, the demand for opening similar business fell. However, business is going well in narrower segments of the market - for example, fixed-price stores or express pharmacies.
The fastest growing franchise in the retail sector in 2016 was a chain of stores Fix Price- it has 2050 enterprises in 723 cities of Russia (however, if we talk specifically about franchise enterprises, then Fix Price has only 250 of them). The reason for the popularity of the franchise lies in its low cost: 300 thousand rubles. Another advantage - narrow niche, which the company occupied: in the field of selling goods at a fixed price, Fix Price is a monopolist in Russia.
Help from the franchisor can be expressed in consultations, staff training, supply of equipment, advertising support - the list can be much longer, depending on the scope of business and the parameters of a particular transaction. For example, in retail trade As a rule, the founder helps the franchisee with the selection of a retail outlet, equipment, and staff training.
Thus, the chain of ice cream stores “33 Penguins” helps franchisees choose the location of a retail outlet, gives recommendations on the design of display windows and the choice of equipment for retail outlets, and helps train staff. The company also helps determine the profitability of a business.
If we talk about the catering industry, then the help of the founder can go beyond the simple selection of premises. For example, the Dodo Pizza pizzeria chain opened an entire school for franchisees and developed its own software Dodo Is, which made it possible to optimize the work of 93 partners in 71 cities of Russia.
Despite the attractiveness of some offers on the franchise market, it is important to understand: where you pay little, you earn the same. For example, opening a branch of the popular Shokoladnitsa coffee shop costs 12.5 million rubles with an annual income of 6.5 million rubles: this means that the cafe will pay for itself only in 2-3 years.
There are franchises where less money is required for entry, and profits in the first year of operation cover initial expenses. On paper, the benefits in numbers look tempting, but they are not always translated into reality.
The starting cost of a franchise, in addition to primary expenses such as rent retail space and hiring employees, includes a lump-sum fee - a one-time payment that the founder charges from the franchisee for using the trademark. In the table below you can look at the ratio of initial expenses and revenue of popular franchises on the market.
Field of activity | Company | Initial Investment | Revenue for the year | Profit for the year |
Hotel | Holiday Inn | 315 000 000 | ||
Marriott | 315 000 000 | |||
Hilton | 315 000 000 | |||
Hypermarkets | Carrefour | 315 000 000 | ||
Crossroads | 7 000 000 | 70 300 000 | 6 000 000 | |
Public catering | Pyaterochka | 15 000 000 | ||
Plantain | 94 500 000 | |||
KFC | 157 500 000 | |||
McDonald's | 75 600 000 | |||
Burger King | 2 700 000 | 28 000 000 | 1 200 000 | |
Cinnabon | 5 300 000 | 22 800 000 | 6 400 000 | |
Papa Jones | 12 000 000 | |||
Chocolate girl | 12 500 000 | 38 400 000 | 6 500 000 | |
Traveler's Coffee | 14 000 000 | 27 600 000 | 5 500 000 | |
Clothing trade | Oji | 11 600 000 | 39 000 000 | 5 000 000 |
InCity | 4 500 000 | 33 000 000 | 5 000 000 | |
Sela | 4 700 000 | 20 000 000 | 5 000 000 | |
Mascotte | 750 000 | 24 000 000 | 3 600 000 | |
Glenfield | 2 500 000 | 18 000 000 | 2 000 000 | |
Westland | 2 500 000 | 12 000 000 | 2 300 000 | |
Tom Taylor | 10 000 000 | 18 000 000 | 2 000 000 | |
Tom Far | 4 500 000 | 36 000 000 | 2 800 000 | |
Finn Flare | 2 500 000 | 15 000 000 | 3 000 000 | |
Sports business | Gold's Gym | 63 000 000 | ||
Appliances | Positronics | 5 800 000 | 60 000 000 | 6 000 000 |
Due to the crisis, many clothing and footwear retailers are offering low start-up fees, for example, InCity, Sela, Finn Flare. The entry threshold has been lowered because the popularity of such franchises has fallen: people began to spend less money on new things. Before purchasing such a franchise during a crisis, it is better to calculate all the risks.
Experts and entrepreneurs interviewed " General Director“They think so. In 2014 they even turned on franchising in twenty promising directions business in Russia for the next 3-5 years.
However, you should not think that a franchise business is easy money. Although the franchisor helps, the success of the project depends 99% on the conscientious work of the partner. To break even, in my experience, it will take on average two to four years, and no one guarantees your success.
The good news is that, after working in a franchise, new entrepreneurs usually learn the basics of business and after a while open their own business. If you have such ambitions, a franchise business will be an excellent school.
Franchise payback is one of important indicators, which is worth focusing on if you, as a franchisee, want to get a fairly quick net profit.
According to business dictionaries, payback generally refers to the period during which all the profits from a started business go to recoup the investments that were made at the time of its opening. The growth of business profits is not the last value here.
There is a special formula that helps calculate the payback period of a franchise and business as such:
Translated, it means that the payback period for investments made in a business is equal to the costs of it divided by the result.
It is worth remembering that the result (R) in this formula is not the volume of production received or services provided, but net profit, that is, the difference between the income received per month and the current expenses made during the same period (for the purchase of raw materials, goods, staff salaries, payment of taxes, rent of premises, public utilities and so on.). They do not relate to investments, but to the cost of business. In the case of franchises, a monthly royalty will be added to the current expenses.
A franchise business also requires investment, and often considerable investment. As we found out above, the franchise pays off after the period when the invested money is returned and net profit begins to flow.
Shokoladnitsa will reduce the lump-sum fee for new franchisees
Franchise with minimal investment And quick payback- a tidbit, but let's think about whether everything is so simple. Yes, it becomes profitable faster, that is, net profit begins to settle in your pocket. But what will this income be?
For example, a franchise with a payback of 1 month for the production of “fried” ice cream. You can find a Russian version - one of our entrepreneurs developed his own freezing unit and patented it. Now he sells the franchise at a price of only 49,000 rubles. While the cost of production of one ice cream roll is 20 rubles, such a roll is sold for 200 rubles. It is quite possible to recoup your investment in a well-located location in the summer in one month. But. How much overall will you earn from this business? Net profit per month, especially after the end of the hot season, is unlikely to exceed 20-30 thousand rubles.
On the other hand, take big business like a Hilton franchise. The payback for such a business, as indicated by the franchisor (and therefore quite likely slightly underestimated), is 8 years. But the expected net income can reach and exceed 3 million rubles per month. Here is a comparison of profitability and payback.
That's why the fastest-paying franchises aren't always the best for business. Although, it all depends on your goals and business plan.
Payback period, size of initial investment and others economic indicators are indicated in ours, where a convenient multi-parameter filter is configured.
What does a franchise mean and other terms included in this concept?
The formulation of a franchise with a quick payback can often be found. But you need to understand that the main objective such a turn of phrase in the description of the franchise is to attract as many franchisees as possible and sell the business model to as many hands as possible from all over Russia.
If we take average figures in relation to Russian realities, then the payback period is more or less profitable franchise is about two years.
By the way, even at the stage of choosing a field of activity and a franchise for it, it is very important to transfer the model, which has been tested and works in the West, to the conditions of Russian reality. A different tax burden and measures to support a business, different conditions for opening and running it, a different mentality of buyers or consumers of services - all this will affect your future business.
If you are still considering inexpensive franchises with a quick payback, then pay attention to those that have been operating in Russia for at least several years, preferably at least five. Over such a period of time, it is possible to compile real statistics - when the franchise paid off, how much money it began to bring in, how many Russian entrepreneurs who bought it went bankrupt, and how many successful business to this day.
All franchises, both Russian and foreign, can be divided into several groups according to the rate of return.
The period when net profit begins to flow is 6-12 months. According to statistics, there are no more than 10% of these in Russia.
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Profit should be expected in 2-3 years. In Russia there are a majority of such franchises.
The entrepreneur will see profit no earlier than in 3 years; the maximum period can reach 10 years.
There is another group - unprofitable, unprofitable franchises. But no one will ever indicate such wording in its description. Moreover, this factor largely depends on the franchisee and his ability to stay afloat.
Important conditions for a good return on investment and profitability of a franchise in Russia: