Community Franchising Insights - Costs

In January-March 2011, the Cinnamon Network conducted research into Community Franchising. Several thousand Churches in the UK were contacted as well as franchisors/ees of 9 ‘ministries’.  We had responses from 190 churches/ministries. Results are as follows:

Costs

Costs associated with Training course providers are low – under £100 to set up and under £50 per course depending on number of participants (assuming use of volunteers and church premises).

Costs associated with Network Franchises seem to be in order of under £1000 to join/get resources and a nominal amount per annum to ‘belong to the club’.

Full Franchises costs vary according to franchise. From responses by franchisees and eliminating outliers, Set-up costs range from £200-£36000, average £5200. Running costs (not just a fee to Franchisor) range from £4000-£40000pa, average £15400. However there are considerable differences per franchise:

Full Franchise

Set-up range       Average           Annual running costs     Average          

1 £200-£7000       £2720                 £5000-£34000                     £13580

2 £200-£10000    £3320                 £4000-£100000                  £45830             
(High (90%+) levels of external funding)

3 £4000-£36000 £11830               £4000-£30000                     £12530             
(70% external funding)

4                                                                   £2400-£36000                     £19200              
(50% external funding)

5 £2000-£26000 £10460              £1000-£26000                      £9020                
(30% external funding)

6                                                                   £2500                                         £2500

7 £1000                    £1000                 £300                                            £300

Obviously costs vary due to availability of volunteers and suitable premises.

The Franchises represented above (not in same order to keep anonymous) were; Christians Against Poverty, Street Pastors, Black Boys Can, Care Confidential, The Lighthouse Group, Romance Academy and Trussell Trust Foodbanks.

One Franchisor has two options for a Franchise:

a)      A ‘full’ service centre which is grant funded. Set up costs are £20000-£40000 but they have an annual income between £50000 and £100000. These don’t directly cost franchisees anything to run as they generate income.

b)      An ‘intervention’ centre. These require training for church volunteers and then cost £3600 per annum, £1200 of which is Franchisor funded.

This then suits both churches with high capacity and smaller churches.