Are you thinking about opening a franchise in New Jersey? If you franchise from a known business, rather than starting from scratch, you can benefit from the vast experience of others. Also, opening a business in New Jersey is inspired, as the state is home to a plethora of sprawling suburban communities adjacent to America’s largest city, New York, and occupied by upper-middle class families that prefer shopping in their own backyards. It is easy to get started. Here are some things you may need to consider:
New Jersey’s Best Cities to Open a Business
Jersey City, the second most populated city in New Jersey, is a port of entry and has significant railroad connections along with 21 miles of coastline. The seat of Hudson County and a part of the greater New York City metropolitan area, the city shares boundaries with the Hudson and Hackensack Rivers and the New York and Newark Bays. Because of its direct transit access to New York, it has developed a large financial district of its own, entitled Exchange Place. This area is often referred to as “Wall Street West,” and it is one the largest banking centers and central business districts in the country.
Patterson is the county seat of Passaic County, as well as its largest city. The area still maintains its rich ties to the past. The beautiful Great Falls of the Passaic River complement the adjacent Great Falls Historic District which now includes period lamp posts and apartments and retail stores made from converted industrial buildings that were once active silk factories. Patterson was actually once known as the “Silk City” because of its lead role in 19th century silk production. Fortunately, not unlike in the 1800s, Patterson is currently undergoing a renaissance, and is once again a bustling place to start a new business.
Best Types of Franchises to Own In New Jersey
Scout & Molly’s is a popular boutique that originated in greater Raleigh, North Carolina in the spring of 2002. The brainchild of founder Lisa Kornstein, Scout & Molly’s became popular enough in the Raleigh area to inspire Kornstein to branch out and offer franchising opportunities to other would-be entrepreneurs. Though she adored fashion, she found the process of opening her own boutique to be rather difficult, and wanted to simplify the process for other entrepreneurs.
Scout & Molly’s does require franchisees to have at least 1,200 feet of space in a Class A shopping center that is highly visible. The company will assist you with real estate selection, leasing, equipment, fixtures, furniture, and opening inventory.
The company will also offer 6 days of instruction to you in multiple areas, including: retail operations, purchasing control, merchandise modules, market programs, point-of-sale systems, and technology training. When you are ready to launch, the company will assist with grand opening preparations, as well as provide on-going marketing, managerial, and technological support. All franchisees will be guaranteed a protected territory.
Scout & Molly’s requires a $50,000 franchise fee and $25,000 of working capital. A monthly 5% royalty fee and a 1% advertising fee is required from franchisees.
Club Pilates, founded in 2007 in Costa Mesa, California, has been franchising since 2012. Headed by CEO Anthony Geisler, the exercise business was named number 31 on Entrepreneur magazine’s “Top New Franchises of 2016” list. It is the largest group of premium Pilates studios in the world, and it is experiencing growth that is far beyond their annual projections.
Club Pilates would like to enter the mainstream fitness market and introduce Pilates as a widely accessible strength-training workout. The company feels that the average person has been excluded from Pilates due to exclusivity and cost and they are looking to change that.
All studios will come equipped with basic equipment, including: chairs, springboards, reformers, mats, balls, barres, and weights. The company will train all instructors prior to the start of working and will train the franchisee for a total of 3 days. Franchisees will also receive ongoing support in the forms of newsletters, meetings, a toll-free line, and security. There is also substantial marketing support for both national and regional campaigns, including media and internet content and ad slicks.
You are required to have a net worth of at least $300,000 to be considered, with $100,000 in liquid cash. In addition to the franchise fee of $49,500, there is an ongoing royalty fee of 6% and an advertisement fee of 2%. Club Pilates does offer financing through third party sources to assist with the costs of starting up, including: franchise fees, inventory, equipment, and payroll.
Unique New Jersey Franchise Laws
New Jersey does have one of the most far-reaching statutes with regard to retailing that most business people and lawyers are already privy to. That law is the New Jersey Franchise Practices Act. The act states that once a relationship is established between a franchisor and a franchisee, it is very difficult for the more powerful of the two contracting parties to walk away. This remains true even if the contract has been written to include termination at will.
The courts in New Jersey have gone as far as to reinterpret this law to cover more than just franchisees and franchisors. It now applies to distributors, wholesalers and other entities that are under the typical assumption that their relationship with a company is subject only to the terms of a specific contract. In essence, because New Jersey’s version of this common state law is so very far-reaching, it is important to keep it in mind prior to signing any contracts.
In conclusion, when you build your business in New Jersey, you will find that the area is home to a family-oriented, yet sophisticated type of customer. And, if you want to start a business with a proven track record, and then present it to this type of demographic, then franchising may just be for you.