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New business old business

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  • 03-01-2017 2:50am
    #1
    Dimplez
    Registered Users Posts: 3 ✭


    Hi, a friend of mine in England started an online candle business afew years ago as far as I can see it's not doing very well now, she asked me if I wanted to franchise it here in Ireland, I think if I throw my heart and sole in I could make it work but I'm not sure where I would stand. Ie how much would I have to pay her? As I'm in adifferent country I have to start from scratch so it's technically it's not a franchise I'm just using her company name? (Or is that the same) Any advice, would be greatly appreciated. In a conversation today she states that she won't ask for money for six months so I can find my feet, then she will want 10%.


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    #2
    Taltos
    Registered Users Posts: 20,830 ✭✭✭✭Taltos


    Mod Note
    Moved from Forum Requests, please read the local charter before posting.


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    #3
    jimmii
    Registered Users Posts: 14,810 ✭✭✭✭jimmii


    The candle market is hyper competitive unless the offering is very different I would be apprehensive about jumping in. In terms of going with your friends offering are they doing something that is good enough to justify you paying them for it rather than just starting from scratch as it doesn't sound like you're buying yourself into a strong brand.


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    #4
    Dimplez
    Registered Users Posts: 3 ✭Dimplez


    jimmii wrote: »
    The candle market is hyper competitive unless the offering is very different I would be apprehensive about jumping in. In terms of going with your friends offering are they doing something that is good enough to justify you paying them for it rather than just starting from scratch as it doesn't sound like you're buying yourself into a strong brand.

    Thank you for replying.....
    In essence I'm only using the name... She has told me that I can buy all my materials from her suppliers but only through her, but it would make more economical sense for me to get my own myself as the postage would be very high, the name is all I really want, I don't know if it's enough to justify me paying her a share of my profits,


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    #5
    Graham
    Moderators, Society & Culture Moderators Posts: 17,642 Mod ✭✭✭✭Graham


    Dimplez wrote: »
    I don't know if it's enough to justify me paying her a share of my profits,

    Almost certainly no.

    When you usually buy into a franchise you get the benefit of a (known) brand, a proven business model, marketing assistance/support, advertising and recommended suppliers. None of this looks like its on the table.

    From what you've posted it appears this business has demonstrated their business model hasn't worked. Why on earth would you want to pay to replicate it?


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    #6
    Dimplez
    Registered Users Posts: 3 ✭Dimplez


    Graham wrote: »
    Almost certainly no.

    When you usually buy into a franchise you get the benefit of a (known) brand, a proven business model, marketing assistance/support, advertising and recommended suppliers. None of this looks like its on the table.

    From what you've posted it appears this business has demonstrated their business model hasn't worked. Why on earth would you want to pay to replicate it?



    Thank you for replying....
    I was thinking the same, although I would still like to use the name... Should I offer her something or should I just call it quits and go it alone with a new name?


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    #7
    duploelabs
    Registered Users Posts: 11,395 ✭✭✭✭duploelabs


    Dimplez wrote: »
    Thank you for replying....
    I was thinking the same, although I would still like to use the name... Should I offer her something or should I just call it quits and go it alone with a new name?

    You'd be buying (and paying an ongoing franchise fee) for a successful name, your friend's business isn't successful. No brainer


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    #8
    Graham
    Moderators, Society & Culture Moderators Posts: 17,642 Mod ✭✭✭✭Graham


    Dimplez wrote: »
    Thank you for replying....
    I was thinking the same, although I would still like to use the name... Should I offer her something or should I just call it quits and go it alone with a new name?

    Get your own.

    Assuming you're based in Ireland and this other entity is in the UK, there may be nothing preventing you from just using the same name. Not sure I'd bother to be honest, just find your own.

    Added:

    the more I think about it, really just get your own name. It sounds like the UK operation is weak-performing at best, why would you want any association with that?


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    #9
    jimmii
    Registered Users Posts: 14,810 ✭✭✭✭jimmii


    Dimplez wrote: »
    Thank you for replying.....
    In essence I'm only using the name... She has told me that I can buy all my materials from her suppliers but only through her, but it would make more economical sense for me to get my own myself as the postage would be very high, the name is all I really want, I don't know if it's enough to justify me paying her a share of my profits,

    Sounds like a great deal for her! It's an easy market to get into and you really get no benefit of having her involved. Candles supplies are easy to get hold of and if you don't want to do that then there's plenty of white label makers out there who will do the hard work for you!


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