At Visa Franchise have helped numerous clients from countries all around the world find and analyze the best franchise investments for them and their families. We often receive similar questions in our initial and ongoing conversations with clients. Based on these questions, we’ve created Frequently Asked Questions for Franchising:
Franchising is a method of distributing products or services. Each franchise system typically includes the franchisor. He lends the brand and business system; and the franchisee, who pays a royalty and often an initial franchise fee for the right to do business under the franchisorās name and system.
Foreign franchises can be quite successful in the U.S. But generally after several adjustments to their business model. We prefer to work with foreign franchisor brands that have at least a few units operating in the U.S. and a track record of success.
Industries in franchising that are expected to continue to experience rapid growth for the coming years are largely in the service-related fields such as:
There are many opportunities across specific sub-segments of industries like quick-service restaurants as well.
Industry growth is a key part to understand before investing in a franchise, however, it is key to also investigate an individual franchise companyās track record.
Among the points which the International Franchise Association (IFA) recommends for investigation include:
Investment requirements range greatly depending on the franchise, location, and industry. Total start-up costs (including the franchise fee and working capital) can range from $20,000 to over $1,000,000, depending on the franchise selected.
For 99% of franchises, the franchise fee, ad-fund, and royalties are non-negotiable. Even for investments in multiple units, there are usually prearranged discounts on the franchise fee. Other minor terms might be negotiated with the help of a qualified franchise attorney.
Visa Franchise has spent a few years analyzing and reviewing countless franchises on behalf of our clients. This has enabled us to find the best opportunities that are available to foreign nationals and have territory availability throughout the United States.
We have reviewed over 700 businesses and only about 50 have passed our stringent criteria to be offered to clients.
There are other franchise consultant sites, which publish the 500-600 franchises that they work with. Regularly, we review their portfolio and might only overlap on 5-7 franchises from their entire 500+ franchise list. There are many franchises but they are not all created equal.
Starting your own business in the United States is possible. But very difficult. There are numerous obstacles that foreign national faces with starting their own business. More information can be found here
Visa Franchise does research and analysis of franchise investments continuously. So far we have analyzed more than 700 franchises, yet we are only working with roughly 50 that we are comfortable presenting to clients. The criteria we usewith the support of the franchisors decrease the risk for our clients.
The cost associated with franchising enables the franchisee to receive all the support and benefits of the franchise. These benefits include site selections, development support, training, marketing, and ongoing operational support. Additionally, the cost allows the franchisee the right to use a brand with a well-established business model and name.
We do have relations with several global franchise brands with units around the world. However, the bigger and more established brands typically require a minimum development of three or more units which raises the investment value to well over $1,000,000.
Also, brands like Dunkin Donuts, do not accept investors that do not already have a green card or citizenship. As for Starbucks, it is not a franchisor within the United States.
A great question that we receive all the time. That answer depends on a variety of factors. E.g. location, industry, how many hours you are willing to work, and if your spouse works with you.
The variability of factors is too high for us to give a concrete answer.Ā We generally donāt recommend franchises that would have net profits of less than $5,000 for an owner-operator.
The Ad-fund is a fee on franchisees that adds to a company advertising fund. This fee is a payment on the advertising and marketing that the corporate company provides to all of the franchises.
Royalties are percentage or fixed payments paid to the corporate company regularly. This fee is the ongoing payment for the right to use a companyās brand name.
The FDD, Franchise Disclosure Document, is the legal document given to potential franchise buyers to promise their disclosure of private corporate information.
For other franchise terms like these see our glossary terms article.
As per our process, it takes about a month or more to decide on a franchise to invest in once we have completed our search and analysis.
It is advised to start small if this is your first investment in a real business (non-financial market investment) in the US. After operating the first unit, you can always open up more franchises in the same brand. That being said, many U.S. franchises require a commitment of at least 3 franchises over a certain time frame (generally 2-3 years).
Visa Franchise has completed research and analysis on over 700 franchises on behalf of our clients. Unfortunately, roughly 30% of franchises do not accept franchisees who are not already Americans or green cardholders.
Typically, the franchises with these restrictions are the more established and well-known companies, such as Subway, Dunkin Donuts, and Baskin Robbins.Ā
Visa Franchise specializes in working with franchises that are more than willing to accept franchisees that are foreign nationals pursuing an investor visa.
The franchisor will support you with training and depending on the franchise, they help with recruiting employees as well.
Some franchises are much more stringent than other franchises. And will vet your previous work experience, net worth, liquid cash, as well as other criteria. In general, the franchises want someone entrepreneurial and willing to roll up ātheir sleeves to get the job done!
At Visa Franchise, we have advised clients who are opening up multiple franchises given their experience in the U.S. or their past jobs in management that surmount to well over $1 million.
Visa Franchise works with many franchises within a diverse range of industries. We are always adding franchises in new industries to our portfolio based on the research and analysis work we do for our clients.
Pet Care
Better Burger
Frozen Desserts
Visa Franchise works with franchises with territory availability throughout the US. Many of our clients choose to reside in Florida, Texas, California, and New York but weāve worked with clients throughout the U.S. and regularly travel on-site.
Many franchisors do require that the franchisee speaks professional-level English. We have some clients who will have another partner as a franchisee that will facilitate the English requirement.
Also, Visa Franchise has franchisors who speak many different languages, including English, Spanish, Portuguese, French, Turkish, Chinese, Italian, and many other languages.