Published on July 29, 2010 – Updated on March 14, 2017
Open a franchise as a self-employed person
Since the Law of Modernization of the Economy, the status of auto-entrepreneur has greatly simplified the procedures for creating a small business. Before embarking on a franchise as an auto-entrepreneur, carefully analyze the constraints. Self-entrepreneur status is practical for testing a market at a lower cost. It allows those who seek to build additional income and to do so within a simple administrative framework. The franchise requires, among other things, a capital contribution which can sometimes prove to be incompatible with the status of auto-entrepreneur. Here are the points to check.
Your responsibility as an entrepreneur
You join a franchise.
In most cases you will need a commercial premises. Your status self-employed imposes constraints on you in terms of commercial leases, particularly in terms of right of renewal and rent cap during the triennial review.
Make sure your franchise business won’t suffer.
In effect, the self-employed is responsible of its activities throughout its heritage whereas in a traditional company, this responsibility can be limited.
Be aware that in bankruptcy casefor example, you are personally liable debts generated by your auto-entrepreneur activity.
Franchise: taxation of the auto-entrepreneur
The auto-entrepreneur is taxed on its turnover and not on his profit like in a traditional business.
If the practice is simpler, it does not allow deducting from the turnover the operating expenses related to its activity (the purchase of a computer for example).
Take this major difference into account when making your estimated budget. The auto entrepreneur is not subject to VAT.
Management: freedom for the auto-entrepreneur not always compatible with franchising
The auto-entrepreneur is not required to write detailed accounts of his activities. The measure can make you dream, but can turn out to be incompatible with the needs of the franchisor.
She does not encourage no longer does the franchisee operate in a rigorous framework offering a activity visibility long-term.
Our tips:
Look beyond the short-term benefits offered by auto-entrepreneur status. Auto-entrepreneurship is simple but may not be well suited to your franchise needs.