Are you considering starting a low-cost insurance franchise? How exciting! Let’s look at some of the key questions you will want to ask yourself and others to find the right affordable insurance franchise for you in 2022.
You will need capital, sales skills, and determination. Are you currently an insurance professional with an inner entrepreneur who is dying to get out and start your own business and secure your own future? Are you a skilled sales professional in another industry and are tired of making more money for your boss than you are for yourself? If so, you sound like a candidate for a low-cost insurance franchise.
Owning your own low-cost franchise will require two types of investments on your part — capital and grit. Although an affordable insurance franchise has a much lower financial bar than some of the other businesses out there, like restaurant franchises that can require hundreds of thousands of dollars in start-up costs, you will still need to have the capital to begin this exciting business venture. Just as important as the money you will need to invest in your business will be the relentless drive to succeed. Especially when you are first starting out, you can expect to put in long hours and probably need to learn new skills. But that’s the fun part! And the long-term financial rewards can be much greater than if you chose to stay working in someone else’s cubicle.
Read everything you can and ask plenty of questions about each low-cost franchise candidate. Interview current franchisees, search online for information, including reviews from customers and both current and former franchisees of any company you are looking into, and check with the Small Business Administration.
When you think you want to own a low-cost insurance franchise and have some good candidates in mind, ask to read the franchising agreement and have an attorney help you with any legalese that is new to you. This will spell out the low-cost insurance franchise cost. There will be a section that includes all fees for which you will be responsible as a franchisee and how they are to be paid. The upfront fees you will be responsible for, as well as royalties you will be required to pay and expenses, such as advertising, that will be your responsibility, should all be detailed. You must understand all of this and be prepared to fulfill your responsibilities. A franchise agreement is a binding contract. You want to know that you will be working with a valuable partner and that you are ready to take this step toward your future success.
The Franchise Disclosure Document (FDD) is also a great starting place to understand the financials of the company with whom you are considering partnering. You need to know that their financials are strong too. Under the Franchise Rule enforced by the Federal Trade Commission, you must receive the FDD at least 14 days before you are asked to sign any contract or pay any money to the franchisor or an affiliate of the franchisor. Item 21 of the FDD provides the franchisor’s three most recent audited annual financial statements.
Educate yourself about the company — where and when did they start, and where are they now? How many locations do they have? How long have they been in the insurance business? How long have they been in business in the part of the country that you are looking into for your franchise (understanding the local demographics is key to the success of any business)? Ask them specific questions about what makes them successful and how they help their new franchisees hit the ground running.
As a new franchisee, you should receive top-quality training and support. Low cost should not imply low quality in any way. They should clearly outline how they support their franchisees to you before you become a franchisee, provide you with training before you open for business, and be there to guide you throughout the life of your franchise opportunity with them.
Visit us at Freeway today or call us at 1-877-822-3024 to learn more about the exciting opportunities available through owning a low-cost insurance franchise for 2022!