Is it worth investing in a franchise in the UK?

Setting up your own business sounds exciting, but it has its risks. That’s why many people in the UK are opting for the franchise business model. But is it worth investing in a franchise in the UK?

In this article we tell you how the sector works, what the advantages and disadvantages are, and what opportunities are setting the trend in 2025.

How does a franchise work in the UK?

A franchise is a business model in which you acquire the rights to operate under the brand, products and system of an established company. In return for an initial investment (franchise fee) and a monthly operating fee (royalty), you receive support and training from a recognised brand.

This model is already well developed in the UK. In fact, according to the British Franchise Association (BFA), more than 90% of franchises in the country are profitable. And this does not just include fast food chains, which are the example that first comes to mind; there are franchises in the fields of health, technology, education, cleaning and one that is particularly booming, pets.

Advantages of investing in a British franchise

On the one hand, there is less risk than starting from scratch. By starting with an established brand, yo reduce many of the risks associated with a new business. The product is already recognised and approved by the customer base.

Secondly, a great brand offers its franchisees advice, training and marketing materials from day one. This is a great option for those who do not have much previous experience in the business world.

Another great advantage is the ease of accessing finance. Many UK banks have specific lines of credit for recognised franchises. If the model is proven, there is more confidence in lending you money.

Once you have bought into the model, you will be able to expand and open more franchises. Many people who started with one franchise now have several more.

Disadvantages of investing in a franchise

As you can imagine, there are not all advantages to opening a franchise in the UK. The initial investment required is high, with some franchises asking for an initial investment of over £50,000. But then, on top of that, you have to add the store, staff, licences, etc.

It is important to have as little creative freedom as possible for the franchisee. It is imperative to follow the brand manual, its operational processes and to participate in the campaigns decided by the head office.

On the other hand, you will be subject to a dependency on the performance of the brand. It will affect you if the franchise has a reputation crisis or changes its model, even if your unit is doing well.

The most profitable sectors to start a franchise in the UK are fast food (especially healthy food such as bowls, poke, etc.) and those related to fitness and wellness.

Most profitable franchise sectors in the UK

Other sectors to consider are care for the elderly, education (language academies and tutoring centres) and pet-related businesses such as pet-groomer and pet nurseries.

Tips before investing in a franchise in the UK

As always, we will give you some advice in case you decide to take the plunge. First of all, read the Franchise Agreement once and ten times, preferably with a specialised lawyer.

Consult other franchisees, who will know first-hand what is involved in running this type of business.

It would also not hurt to find out about the status of the brand. It may have plans to expand or it may have reached a dangerous plateau. Finally, check that it is registered with the BFA.