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5 Reasons to Start a Telecoms Franchise

Posted by Joshua McKee on 10-Apr-2017 16:24:55

Starting a new business isn't easy. But what if you could have all the benefits of starting your own business with the resources, proven business model and support of a bigger company? If this sounds like something you'd prefer, owning a franchise might just be the right solution for you. There are, however, many different types of franchise to choose from. So, in this blog, we shall attempt to open your eyes to some of the excellent reasons as to why you should consider a telecoms franchise.


1. Recurring Revenue

Recurring revenue is one of the fundamental reasons why telecoms businesses are so attractive. As we all know from our own use of telecoms services, customers pay for their services on a monthly basis, typically over a 12, 24 or 36-month contract. That means, by selling to a customer once, you also collect an income (or revenue) from that customer for the remaining 12, 24, or 36-months. It's not surprising then that when you add even just a few customers per month, these monthly payments really start to stack up. See the 'Rule of 78' diagram below. By adding just 1 customer per month (figures below are based on an average business customer's spend), over 2 years the total revenue becomes rather significant. Just think what would happen if you added 3, 4 or 10 customers per month!

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2. No stock or store needed

Unlike many other types of businesses, with a telecoms business, you don't necessarily need a store front or require stock to trade.  Services are ordered directly from the supplier and 'delivered' directly to the customer.  Therefore, you don’t need to use up your budget by renting or purchasing space, holding stock you may not use and can, therefore, invest your money into growing your business instead. By partnering with the right suppliers, most of the physical hardware like phones, routers and modems will be handled (and in many cases, installed) by them. Systems are primarily based online, meaning you can effectively run your business from wherever you please, providing there is an internet connection.

3. Control your work/life balance

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As mentioned above, as there is no need to have an office or physical premises, you can work from home or really, wherever you want. This means that you have greater control over your work/life balance - whatever this means for you.

  • Spend more time with the kids and the family.
  • Never have to do that hour long, twice daily, commute.
  • Work the hours that suit your lifestyle.

4. Huge, and ever growing, potential customer base

Pretty much everyone you meet will be a potential telecoms customer. Whether on a personal or business level. The Telecoms market in the UK is growing year on year. Residential and personal users are demanding and using more telecoms services (e.g. mobile, mobile data, the internet for browsing, streaming tv and video, data for tablets, etc) and consuming more data as a result. Additionally, the ageing population and so-called 'silver surfer' generation are becoming more confident using the internet and are also owning a greater percentage of smartphones, a trend that has been exponentially increasing in the last few years.

The pattern is also present, if not greater, for business customers. Most modern businesses rely solely on Telecoms to operate their business. Offices now require high-speed data connections, coupled with VoIP or Hosted Voice phone systems which run over the internet. Many businesses provide its employees with a work mobile phone. Cloud servers - which offer server resources over the Internet - are replacing traditional computer network systems, to host data and resources to facilitate greater collaboration on documents and reduce the need for transfers back and forth users. As such, business customers too are using an increasing amount of telecommunication based technologies.

In addition to the 'traditional' telecoms services being used, there is also a huge requirement and uptake in M2M and The Internet of Things. M2M stands for ‘machine-to-machine’. The general definition of an M2M connection is a connection between devices, often wireless, where human input is not necessarily required. Commonly used examples of M2M are in smart metering (where the meter reports energy use back to a central billing database) or a burglar alarm, which may contain a SIM card to enable communication with monitoring offices. Vending machines are another common example, as some may use M2M technology to keep a central computer up to date with stock levels. The Internet of Things (IoT) describes the creation of new and innovative services by the interconnection of everyday devices, often using M2M connections. Over the coming decade, the IoT is expected to grow to hundreds of millions of devices in the UK alone (Ofcom: The Communications Market 2016), bringing benefits to consumers across a number of sectors including transport, healthcare and energy.

It's a great time to enter into the world of Telecoms and make your business part of this growing industry.

5. Relatively easy start-up

For the reasons mentioned above, as far as franchises and start-ups go, a telecoms business can be one of the easier to set up.  The right partnership can reduce many of the barriers to entry usually in place when starting a business, usually as a result of lack of resources, whether that be time, money and/or staffing.  Additionally, whilst all franchisors will ask for a capital investment to start a business with them, this investment can also be significantly lower with a telecoms franchise as there are relatevely few requirements (premises, staff, stock etc) needed to kick your business off from day 1.   This results in a lower financial risk when compared to the bigger, more expensive franchises, yet giving you the same opportunity to turn your business into a massive success. 

In summary, there are many reasons why a telecoms franchise can be so appealing, however it really depends on your personal choice, and whether these benefits are what you are looking for in a business.

As always, please feel free to leave your comments below, subscribe and keep an eye out for our next blog post!

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Sources: Ofcom: The Communications Market 2016 -  https://www.ofcom.org.uk/__data/assets/pdf_file/0026/26648/uk_telecoms.pdf 

Topics: Telecoms, franchise, franchising, telecoms franchise

Author:Joshua McKee

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