Franchise Costs - Introduction

Introduction

Franchises and independent small businesses, for the most part, share many of the costs associated with starting a business. However, franchises do have some special costs associated with them, which this article will profile along with the expenses that traditionally come with beginning a business.

Franchise costs are commonly divided into two categories: initial (or upfront) costs and ongoing (or continuing) costs. Initial costs are the expenses that the franchisee will pay in order to begin operation of the franchised business while ongoing costs are the expenses involved in maintaining the operation. Franchisors have various ways of presenting the costs associated with beginning and maintaining one of their franchised businesses so please consult the Franchise Disclosure Document (FDD) of a specific company for a complete breakdown of costs associated with investing in that franchise.

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