Turn ambition into cash

By: Linda Whitney

SETTING up shop could pay you good dividends if you choose to go down the franchise route.

The retail market is not as dire as it looks: year-on-year sales rose by 3.8 per cent in July, according to the Office of National Statistics.

With a franchise, you start with a name that shoppers already know. Big names such as buy-and-sell store Cash Converters and video games retailer Chips are franchises.

‘Our already-growing business is likely to look up in a recession,’ says Mark Lemmon of Cash Converters.

Cash Converters services include sales of second-hand goods, cheque-cashing, pawnbroking, salary advances, Western Union money transfers and loans on cars.

You should have previous business experience. ‘Experience of management, cost control and achieving targets gives the best start,’ says Mr Lemmon. You will be running a team of staff from day one.

Cash Converters provides training, including business management and planning, and courses from gemologists.

A large store franchise costs £240,000 and the mini-store option is £140,000.

Retail franchisees gain access to prime retail sites as big commercial landlords usually accept companies only with an existing successful trading record, which established franchises provide.

You also get help with finding and fitting out suitable premises. ‘We help franchises find premises, though it can take a few months before you are ready to open your store,’ says Cathryn Birchall ofBlazes, whose franchisees sell fireplaces and central heating.

You should enjoy meeting people and be able to sell, though the £80,000 investment includes training and showroom stock.

Blazes is also piloting a central heating sales franchise that you can start from home.

Retail franchisees also get goods at wholesale prices unavailable to individual traders.

Sales in the food and drink sector are growing, says the British Retail Consortium, and food and convenience stores Budgen and Londis are looking for more franchisees.

Budgen helps you assess if your site or existing store is suitable, and offers stock deliveries, training courses, human resources and operations support.

There is no joining or weekly membership fee, as the franchisor makes money on sales of stock. Londis is looking for existing convenience store retailers. The basic fee of £31 a week includes deliveries and you can buy packages that include help with marketing and development.

New retail franchises include Shared Earth, the chain of shops selling fair-trade goods.

You need a retail, management or service background and an interest in fair trade.

TRAINING includes an overseas trip to meet the artisans who make the products. The investment is £73,700.

If you are interested in electronics, The Satellite Shop is looking for franchisees to sell electrical entertainment goods, including digital aerials, ready for the digital switchover, which means every house will be digital by 2012.

The investment is £40,570.

Franchisees with Shopper Anonymous run teams of mystery shoppers to gather feedback about customers for retailers. It’s a management franchise, so you need management skills and the ability to make presentations to clients. Cost is £27,000.

Cash Converters 01920 485 696; Blazes 01282 831 176; Budgen/Londis 08700 500 158; Shared Earth 01904 636 400; The Satellite Shop 01892 548 468; Shopper Anonymous 01424 858 230..

RETAIL gets into your blood. It’s not for everybody, but many love it, like me,’ says Gordon Cox, pictured with his son Ben, who is one of his operations managers.

After a 25-year career at top management level with High Street names such as MFI, Powerhouse and Allied Carpets, Gordon found out about the Cash Converters franchise at an exhibition.

‘I’d wanted to be my own boss for a long time, but it’s hard to come up with a concept that means you are not just an also-ran on the High Street,’ he says.

‘I liked Cash Converters’ brand recognition, the training and back-up, and the diversity of services.’ He now has four outlets across Yorkshire and plans more before the end of the year.

‘The secret of retail is to find out what works and keep doing it. With a franchise like this, they already know, so you just have to stick to the system,’ he says.

He advises: ‘Working in retail before you apply for a franchise is the best way to tell if you have the bug.’