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The beauty of investing in a franchise business is that someone else already did the dirty work for you; the business plan, the sales strategies, the advertising, etc. have already been thought out, set up, tested, and obviously shown positive results.  The owner of the original concept is likely swimming in money, but can you personally make millions yourself on franchise income?

As with most things in life, the answer depends on a number of different variables.  Your first task is to choose a franchise that sells a product or service that you are or could be passionate about.  This will make it easier to stick out the start-up phase while you wait for your investment to turn into profit.  Do some research to find which franchises have been the most profitable recently and see if the one you’re thinking of ranks high enough for you to want to move forward.

Are you able to set up your franchise in a profitable area?  In other words, will you be located in a place where customers are likely to patronize your services?  If not, you may have to work a little harder to bring in the business, despite the proven advertising set up at corporate.

Most research dictates that you should expect to see a 10-15% return on your investment over time, and that’s if you’re a passive franchise owner.  The theory is that the more active you are in your business, the higher your potential income can be.  One thing to be cautious about is the idea that a high-investment franchise should bring the highest return.  That’s not always true.  This also depends on your location, your overhead, your personal involvement, etc.

You can likely bring in a comfortable income with a franchise, but the real money can start rolling in if you open multiple locations.  Many people find that that’s the best way to reach their desired income potential.  Of course, you want to make sure your first franchise succeeds to the point where you can realistically take a stab at another.

Most importantly, don’t treat franchises like a free ride.  If they were immediately profitable, I’d bet that the only existing businesses would be franchises.  Despite the fact that the initial planning has been done for you, you still need your own personal plan on how to make the existing principles work for you.  As always, do your homework, and remember that the more time and effort you put in, the better your return can be.