Why H&R Block is the Best Known Tax Franchise in the World
While many people know FranchiseHelp for the world's largest database of franchise opportunities and our extensive franchise disclosure document store, in response to reader requests we've begun to put more emphasis on interviewing franchisors, to help potential investors better understand the differences between the specific industries and opportunities available to them. Read on for an insider perspective from H&R Block on a) the importance of branding, b) the difference between owning an independent business vs. a franchise, c) how to evaluate a specific franchise opportunity, d) what H&R Block looks for in their franchisees, and much more. Then, for more details, read up on our H&R Block Tax Services franchise profile.
What are the advantages of having a brand name like H&R Block attached to your business?
Our experience and longevity have established the H&R Block brand as one that is synonymous with quality, expertise and stability in the minds of the public. This reputation is the biggest advantage a franchisee can have over the competition.
Our marketing research shows that unaided recognition of our brand is almost five times higher than our nearest franchise competitor. That's because when it comes to serving our clients, no one has the experience or resources to provide the level of service that H&R Block can deliver.
With more than 13,000 domestic and international offices H&R Block has about twice as many locations as our nearest competitor. This presence further reinforces an already respected and established brand name that represents stability, quality and tax expertise in the minds of your prospective clients. Our brand strength is one of the most powerful tools a franchisee can have and no competitor can offer a better franchise opportunity.
How does owning a franchise differ from owning your own independent business?
A franchise system combines the efforts, motivation and local business skills of an independent business person with the experience of a strong "partner" with a tested system for delivering a product or service, management and marketing know-how and standardized operating procedures. One of the principal benefits of investing in a franchise is the ability to receive advice and assistance from the franchisor. Leveraging the established brand, systems and support allows the franchisee to focus on growing the business. Absent the franchise business model, the independent business owner is responsible for establishing the business systems and structure needed to be successful long- term which often distracts them from focusing on growing the business.
Once franchisees join H&R Block, they find they are not on their own. Not only do they have the strength of the H&R Block brand behind them but they also have continuing support for marketing, training, communications, technology and more.
Most important, H&R Block has a strong field management team that is equipped to provide our franchisees with the personalized service and resources they need to help ensure their success. As part of a franchise system, franchisees benefit from the economics of scale. H&R Block spends significantly more on national marketing and advertising than our nearest national competitor, according to Nielson media research. That's marketing dollars that will directly benefit our franchise businesses, and it's all at no additional cost. To help with local marketing activities, H&R Block also has a dedicated staff at our corporate headquarters that provides free, individualized public relations and marketing support to help promote the franchise business within the local community.
Many franchisees think just because they put a brand name on their storefront people will flock through the doors. What type of due diligence do franchisees need to conduct to make sure their business will succeed?
Before investing in any business, franchise prospects and their advisors should evaluate the business operation, the suitability of the business to their personal interests, the costs of the franchise, availability of financing, the prospective return on investment, training provided by the franchisor, experience of the franchisor, their personal experience and a comparison to industry competition.
A prospective franchisee should conduct a thorough evaluation of the franchise opportunity. The Franchise Disclosure Document provides much of the information a candidate should consider. Additional discussion with franchisees who are a part of the system and those who have left the system will provide additional insight to the franchise opportunity.
Beyond that, candidates should investigate what the franchisor brings to the table:
- Firmly established franchise organization
- Brand Recognition
- Proven track record - H&R Block has franchised locations for more than 50 years
- Financially secure - H&R Block is not dependent on fees generated from selling franchise locations to support its operations
- Recession resistant industry - income taxes have been around for centuries and have grown more complex each year
- Financial incentives available when joining the franchise network
- Designated territory
- Year round revenue opportunities - With our Business Services program we support your efforts to generate year round revenue through payroll and bookkeeping.
- Conversion payment for those who have an established tax business and want to join
- With 55 years in business and preparing over 500 million tax returns you will receive best in class training and support -
- Start up assistance
- Peer Networking
- Call Center support
- National Marketing
- Customized, local Marketing Support - H&R Block provides franchisees with advertising dollars (this is not contractual; but BMB is not guaranteed and could go away)?
- H&R Block Tax Institute and Research Center - answers to those tough tax questions available to franchisees at no charge
- Franchise Equity Lending Program - available to H&R Block Franchisees interested in securing capital to grow their business
- Growth Programs
- Acquire a competitor - H&R Block contributes up to 80% of the purchase price of an established tax business for franchisees interested in growing their business
- Innovative products and services designed to get and keep more customers
- Products and services to meet the changing needs of clients
- Products and services designed for multicultural markets
- Succession Planning - When the time is right, H&R Block will work with franchisees to develop an exit strategy to help maximize their return on investment. H&R Block provides the tools needed to successfully transition the business.
What type of research does H&R Block do?
H&R Block is looking for business minded entrepreneurs who are talented, energetic and who have a passion for success. A qualified candidate will have the drive to succeed, the ability to expand their own business, a commitment to hard work and a sincere desire to provide the best client experience possible. The candidate will be able to dedicate full-time best efforts to the business.
H&R Block receives personal and financial information from franchise candidates. A background check and credit check are also a part of the approval process. Candidates will complete an interview with our field management team to ensure their understanding of the opportunity. H&R Block considers personal and business experience, financial status, management experience and how well the candidate will "fit" the franchise business model.
Why does H&R Block offer a franchise with no initial fee to buy into?Isn't this a huge risk for your company?
At H&R Block, we believe in making it easy - and affordable - for entrepreneurs to do business under the H&R Block name.
Out of all major tax companies in the franchise industry, H&R Block has one the lowest initial investment costs. While all of our competitors require an initial franchise fee that ranges from $24,000 to $40,000, H&R Block is committed to the success of our franchisees and has no initial fee, other than a fully refundable $2,500 security deposit. From the beginning of the franchisor/franchisee relationship H&R Block is making an investment in each of our new franchisees. H&R Block's success is dependent on the success of our franchisees. Franchisees pay a royalty as revenue is received. There are no minimum royalty amounts due or additional costs for national advertising.
How difficult is it for franchisees to adhere to H&R Block standards?
One of the key benefits of becoming a franchisee with H&R Block is the advice and assistance provided by our Franchise Field Management and our corporate Franchise Support team in Kansas City. Working together with our Franchisees H&R Block provides the training, support and resources necessary for its Franchisees to adhere to the H&R Block standards.
Annual Business Plan meetings in addition to National, Area and/or Regional meetings allow our Franchise Field Management and Franchise Support Organization to share the latest information and best practices with H&R Block Franchisees. An elected team of Franchisees also serves on the Franchise Leadership Council representing the interests of franchisees in key decisions made by the company. Networking with franchise peers provides additional support for franchisees to capitalize on making the most of their business.
Henry and Richard Bloch founded H&R Block "on a culture of providing superior customer service and on a pledge to stand behind their work." How do you ensure this happens consistently throughout all locations?
H&R Block has more than 100,000 dedicated associates, committed to delivering superior tax services and advice to clients in the United States and 15 other countries. We realize that it is our people, including 4,000 franchise locations and their associates, who make the difference to our clients who trust us with their tax preparation needs.
The training and support provided to company and franchise associates along with the proprietary software used by our tax professionals ensures an accurate tax return delivered in a consistent and professional manner.
H&R Block continues to meet the changing needs of our clients with a full complement of innovative products and services designed to maximize client acquisition and retention.
H&R Block Guarantee - Included in every tax return, we continue to honor the guarantee Henry and Richard Bloch established when they founded the company. Clients are reimbursed penalties and interest charges due to any H&R Block error. Audit assistance is also provided to clients who need this coverage as well as POM, a product offered that gives the client additional security...
Clients may also elect additional coverage with our Peace of Mind Extended Service Plan whereby clients receive a worry-free guarantee that covers any additional taxes assessed, up to $5,000.
What's one piece of advice you can provide to people who want to work for themselves?
When evaluating being employed for yourself, consider both the short and long term objectives of Income, Lifestyle, Wealth and Equity, then determine how the business opportunity aligns with these objectives. Being in business for yourself requires commitment, hard work and a desire to succeed.
To learn more about the H&R Block franchise and review FranchiseHelp's H&R Block Tax Services franchise opportunity profile.
Low Cost Franchising - Options for Affordable Franchising
Fortunately, there are numerous excellent low-cost franchise options available, and those options span nearly every industry an entrepreneur could imagine.
2015 Top 5 Restaurant Franchises
Without a doubt, the industry most tied to franchising in Americans' minds is food. Some of the most popular restaurants out there, including McDonalds, Subway, Chik-Fil-A, and many more, can credit theirmeteoric growth to the skill of theirfranchisees.
Don't Write a Business Plan
I've started and successfully harvested businesses. I've taught entrepreneurship for almost 20 years. As a part of my teaching and research I've written books and texts on how to write a business plan. I've read almost a thousand of them. Now I believe franchise companies can think differently about business plans.