Franchises: Aim low for better targets

There are more than 1000 different franchise chains offering businesses to potential owners throughout Australia, reports ANDREW KENT, but the point to remember is to be selective.

Lesser-known franchises may be a better investment

The micro market for businesses valued at less than $500,000 is the vast majority of Australia’s more than 800,000 business market. It includes sole operators, long-established businesses, existing franchises and new franchises.

Most of these businesses have few tangible assets to speak of because they generally lease their premises and major equipment such as vehicles. So estimated future earnings are a key factor when assessing opportunities in the micro market.