Before committing to a decision, though, some careful planning is required, in particular, how they will finance the purchase of the business. For many prospective franchisees this usually means taking a bank loan and their first port of call should be one of the main banks that has a dedicated franchise department that can provide finance for the purchase of a franchise.

The well-established BFA member franchises have close connections with banks and other financial institutions, making it easier to raise money for a franchise than for an independent business idea. But careful financial planning is still needed.

Cathryn Hayes, national franchise manager at HSBC, an affiliate member of the BFA, said: "You must be prepared to take a realistic view of what you may be able to borrow, and your local bank manager will be able to discuss the possibilities with you. Having established the start up costs and borrowing requirements, you will need to look at the potential earning power of the business. Does it justify the level of investment and can you recover your investment?"

For an established franchise, most of the major banks will lend up to 70 per cent of the start up costs. For new franchises that figure will be closer to 50 per cent. Banks normally expect the franchisee to contribute at least 30 per cent of the cost of the franchise, which should be unborrowed.

Most industry experts agree that borrowing money to finance the purchase of franchise has become easier. Mark Scott, national franchise manager at BFA affiliate member NatWest, said: “There is a more choice for those requiring finance. Franchisees can have fixed or variable rate loans, while a flexible business loan allows them to draw it down in stages; for example if they are having premises built, they may initially want to access only a proportion of the loan. Capital and investment repayment holidays can be arranged, and with some seasonal businesses we can authorise a reduction in repayments during the quieter periods.”

Loan security is usually provided through a second mortgage taken out on property, but it can include a charge over stocks and shares and some insurance policies. If no security is available the bank can secure a guarantee, up to 75 per cent of the amount borrowed, from the Department of Trade and Industy’s Small Firms Loan Guarantee Scheme.

Prospective franchisees should prepare a detailed list of their personal expenditure, including things like mortgage payments, household bills, and outstanding loans etc, in order to estimate how much money they need to take out of the business in order to live.

They also need to prepare a business plan, which includes cash flow forecasts for the first couple of years of the business. This is vital for securing finance from the bank, and a good franchisor should be willing to help with the preparation of it.

For more information about all aspects of franchising visit the BFA website at www.british-franchise.org.uk