“Keep Austin Weird“
That’s the unofficial theme of the Texas city best known for its deliberately off-kilt vibe and music and entertainment scene. It’s an exciting and vibrant city of innovators, creators, and independent-minded entrepreneurs and doers. No wonder Austin is an ideal (though wonderfully weird) location to start and grow a thriving business.
Austin also identifies as the “Live Music Capital of the World” and is perhaps most famous for its annual South by Southwest (SXSW) music festival. The city has experienced explosive population growth, gaining more than 300,000 new residents since 2000.
Where there are potential customers, there are businesses seeking their patronage. But what kind of business?
Franchise business owners are their own bosses — but they follow a model of a pre-existing business with a proven track record. Franchisees adopt the name, logo, branding, products or services, and business methods of that successful franchisor.
Franchises thrive in this dynamic city of nearly a million people and countless visitors. Here are some favorites.
A Few of the Top Franchises in Austin
Since the city made its mark in entertainment and as a tourist magnet, it’s natural that many of the top franchises for sale in Austin are about food and beverages and leisure activities. But those aren’t your only choices, by far.
The following are a few leading franchises that might work well in Austin based on its economy and demographics. If interested, reach out to franchise reps to see if they have locations or territories available in the city or metro.
Dunkin’
You’ve got to wake up somehow after a long night at SXSW. One excellent way for your customers to do it is with a cup (or several) of Dunkin’ coffee with a few glazed donuts for dipping. There are currently only about four Dunkin’ franchise locations indicated in the city, so there might be some real opportunity here.
Anytime Fitness
Austin trends both younger and fitter than the U.S. population overall. For instance, 43% of the city population is 44 or younger, while the national average is 36% under that age. In terms of conditioning, Austin is one of the healthier cities in the nation, with lower figures for obesity, diabetes, and high blood pressure. Can you think of a better place to open a brand-name fitness center?
Five Star Bathroom Solutions
Do you feel at home with a tool belt? Do you have an eye for interior design? Austinites have money to spend and homes to remodel. Five Star Bath Solutions is a leader in the field and has a presence in Austin. Look into it.
Marriott International
Okay, you’d better have some deep pockets or a team of eager Wall Street investors. If you do, consider investigating opportunities with one of the nation’s leading hoteliers. After all, everyone who doesn’t live here wants to visit and discover Austin’s weirdness for themselves. Some can afford to do it from the comfort of a Marriott hotel. The franchise operation includes Westin, Sheraton, Marriott, and Fairfield brands, among others.
Homewell Care Services
While Austin trends younger than average, there are plenty of older residents, too, and even the young will get there eventually. The idea here is to provide non-medical services, such as light housekeeping, food delivery, and errand running, so the elderly can stay in their own homes. This is a “feel-good” franchise opportunity as well as a potentially profitable one.
Smokey Mo’s BBQ
About a third of the population of Austin is Hispanic. But so what? Everyone loves a good sit-down Mexican restaurant — and Smokey Mo’s BBQ is a strong contender. They’re actively looking for franchisors in Austin and other parts of Texas. Does that give you ideas?
Freeway Insurance
An insurance agent with an inventory of quality insurance products can find new clients every day with how the city’s population is booming. Freeway is one of the nation’s leading personal lines insurance carriers, so your prospects know the name and trust your brand.
Understanding Franchise Costs in the Austin Business Market
Regardless of where you start a franchise business, you’ll pay a franchise fee. That’s the startup cost that enables you to call yourself a Dunkin’ restaurant, an Anytime Fitness gym owner, or a Freeway Insurance agent. Some franchises have a standard fee, no matter where you locate. But others will charge more in terms of a franchise fee in a large or fast-growing city like Austin. This amount could be anywhere from a few thousand dollars to well into six figures.
Your franchisor here and elsewhere will also charge you royalties on the products or services you sell. The logic here is that your customers are buying from you because of that established brand’s appeal. In other words, they’re ordering your Big Mac or your cheap car insurance policy because they’ve already been favorably exposed to the brand at other franchise or company-owned locations.
You might also be required to share in the marketing costs, so you see a commercial for your store on TV or the internet or see a billboard, print ad, or radio commercial that helps deliver customers.
In addition to these franchise-specific budget items, you’ll also have the typical startup costs of any new business. This might include office or building rent, the purchase of gear or equipment, transportation and utilities costs, and workforce expenses if you start with employees.
In Austin, the thriving economy and high quality of life also result in it being an expensive city in which to live and do business. This means your startup costs will likely be higher than they would be if you started your business in a smaller town or another part of the country.
However, it’s the dazzling growth and popularity of Austin that can provide you with a customer base much larger and more motivated to buy than you might see in another part of the country.
Financing Your Austin Franchise
At the very least, you’ll need several thousand dollars to start your franchise company. That amount could exceed one million dollars, depending on the opportunity. Consider, for instance, one of the Marriott luxury hotels.
In some cases, you might be able to finance your franchise with your savings and the revenue stream of a working spouse. But that’s probably only likely if the opportunity lets you work from home rather than an office or other commercial space and “hire” only yourself until the business takes off.
In other cases, you might have already drafted a team of partners or investors who want to explore the opportunity with you. Here are a couple of other possibilities.
The Small Business Administration
The SBA is an independent agency of the federal government. In addition to offering guidance and support to first-time business owners and even more experienced entrepreneurs, the SBA provides government-backed loans at lower interest rates to qualified borrowers. Be sure to check in with this helpful resource.
Local Lenders
Many of the banks and other lenders in Austin are eager to keep the economy soaring. They know that startups sometimes become economic giants. It can be challenging for first-time business owners to secure a conventional bank loan, but start by trying such local sources as Wells Fargo Bank and Austin County State Bank.
Franchisors
Some franchise operations will provide loans to qualified entrepreneurs who have some funding in hand. Be sure to ask about the possibility when you talk to a franchise rep. Others might discount the franchise fee to certain parties or provide other ways of making the financing not quite so challenging.
Legal Considerations When Seeking Franchise Opportunities in Texas (and Austin)
Austin — and the entire state of Texas — are famously business-friendly. That means it can cost less and involve much less red tape to start a franchise business here than might be the case in most other American cities.
There is no state corporate tax or individual income tax. You might have to pay an annual Texas franchise tax, but only if your business meets or exceeds $2.47 million in yearly revenue.
You’ll also have to obtain a business license from the Texas Secretary of State’s office or that of the county clerk. And depending on the line of business in which you work, you might have to apply for additional industry-specific licensure. Your accountant or lawyer can alert you to this possibility.
You’ll also want to let your business advisors review the Franchise Disclosure Document (FDD) you’ll receive from whichever franchise operation draws your interest. By law, all franchisors must provide this written documentation of the offer, the details, the costs, and the expectations of new franchisees.
The bottom line is that Texas is a great state to do business in, franchising can be an ideal business model, and Austin will keep franchising fun, profitable — and even a little bit weird. That’s a good thing.
Consider a Freeway Insurance Franchise in Austin
Ready to get serious about chasing down franchise opportunities in Austin? Maybe you’re a sales professional eager to be your own boss.
Few lines of business are in greater demand than insurance. Just about everyone in this dynamic city needs auto, home, renters, life, business, or other forms of coverage.
Freeway is one of the nation’s largest personal lines insurance carriers. Your policyholders know and trust us. We’re eager to open Austin locations and let talented entrepreneurs join our coast-to-coast network of successful franchisees. You’ll receive top-tier training, ongoing support, and access to the major brands your customers need and want. Call your Freeway Insurance franchise representative at 877-822-3024 today if you’d like to own your own company with a preferred brand and grow a rewarding career.
Or give us your contact information online, and we’ll make the next move.
