There are huge benefits that come with buying a franchise. From the established customer base and clever marketing that comes with a well-known brand, to ongoing support and training from a head office team that is invested in your success. But purchasing a franchise is a significant monetary investment. When it comes to investing in a franchise, understanding exactly what costs are involved and doing your due diligence is crucial to making a smart decision.
So, how much does it actually cost to own a franchise in Australia?
Let’s take a look at some of the typical fees involved and what it takes to become a franchisee.
Average Australian franchise business start-up costs
The average total start-up cost to own a franchise in Australia covers a huge range. This is because there is a multitude of franchises available, and not all are created equal.
According to the Franchising Australia 2016 report, the average total franchise cost starts from $59,750 for non-retail franchises and from $287,500 for retail franchises. These figures don’t include food franchises which make up 19% of the franchise industry.
Food franchises are generally more expensive to set-up due to the quality and volume of the equipment required to create the food. Add to that the restaurant fit out, perhaps a drive-thru (and the land that requires) and the staff needed to service customers to the highest standards… it’s no wonder food franchises are dearer. But it’s worth it – as food franchises, like us here at Oporto, are usually popular brands with significant, established customer bases and brand awareness. Your initial investment may be higher, but the chance to be part of such a wonderful success story is so much more attractive.
As a guide, typical Oporto restaurant franchise start-up fees range between $350,000 and $700,000 plus GST.
How much does it cost to buy an existing franchise store?
The answer – it depends.
Let’s continue with Oporto as our example, since it’s a franchise brand close to our hearts. To buy an existing Oporto business, the only upfront costs you’ll need to pay to craveable brands, the franchisor company who own Oporto and two other well-known Australian food franchise brands, is a training and administration fee totally $22,500 plus GST.
But you’ll also need to pay the franchisor whose business you’re buying. This will be a negotiated price between you and them dependent on a multitude of factors.
Other one-off and ongoing costs for buying an existing Oporto store will be detailed in the Disclosure Document our Franchising Team will provide to you when you enquire.
And while we can’t give you a definitive cost for buying an existing Oporto store, we can give you a bit more information when it comes to new Oporto stores.
How does that compare to buying a new franchise store?
New franchise store start-up costs are clearer to communicate as they’re set by the franchisor’s extensive experience in opening new locations.
For a new Oporto store, the typical franchise start-up costs are:
- $350,000-$450,000 new store fit out cost
- $50,000 plus GST franchise agreement fee
- $12,500 plus GST training fee
- $10,000 plus GST administration fee
Other ongoing costs for owning an Oporto store will be detailed in the Disclosure Document our Franchising Team will provide to you when you enquire.
How do you go about choosing a franchise?
- Shortlist your desired franchisors
Franchising is like a marriage. And franchisees come from all walks of life. Do your research and look for companies that are a good match and align with your values.
- Meet with them
After the application process, you’ll get the chance to meet with the franchisors either over the phone or in person. You’ll need to show you’re committed, capable and have capital.
Franchisors have a strong vetting process and will assess your business acumen and passion; the willingness to work with a team to drive performance, create success and ensure customer difference.
- Ask to go behind the scenes
You won’t know if your desired franchise is truly right for you until you’ve had the chance to work in one of the stores for a day. We offer our franchisees a 10-week induction training to give them all the skills they need to run their business – from strategy and management skills to marketing, hands-on food preparation and customer service. It’s a mix of classroom and in-store training; with a heavy focus on the in-store side of things. If training isn’t included as part of the agreement with your franchisor, you’ll need to get support to skill up in running your business.
- Create a business plan and seek finance and legal advice
Once you’ve made your decision, it’s time to get busy with creating your business plan, starting to work with your franchisor team and putting the wheels in motion to finance your business.
Oporto: why it’s an excellent franchise opportunity
Maybe we’re biased; but we think Oporto is an excellent franchise to own – both here in Australia and overseas.
- We do things as a team. We have over 1,500 people working to satisfy hungry customers every day. We’re inclusive, have a great franchise company structure and we like to collaborate and have fun with our franchisees.
- We train you up. Even if you’ve never worked in the industry or owned a business, you’ll be taught everything you need to know. You’ll also have the support of the area and state managers, CEO and our shared services teams.
- We’re community-minded. Generosity is part of Oporto’s DNA. On a grassroots level, we sponsor over 100 local sports teams, and our football familia is continually growing!
- We really are an up-and-coming brand. We started in North Bondi, Sydney in 1986 with one store. We became a cool, iconic and well-loved brand in NSW, and now we’re growing nationally and internationally.
Oporto is THE franchise to buy if you’re looking for a future with a growing brand!
Want to know more about owning an Oporto franchise?
Our Franchising Team is here to help. Get in touch today!
- QLD and TAS – Sean O’Connor – Sean.OConnor@craveablebrands.com – 0427680221
- NSW and ACT – Fernanda Camerini – Fernanda.Camerini@craveablebrands.com – 0419736345
- VIC, WA, SA and NT – Leisha Fontana – Leisha.Fontana@craveablebrands.com – 0408927750
- International – Carl Tjandra – Carl.Tjandra@craveablebrands.com