Franchise Investment: Capital and Sweat Equity

There are two things you'll put into your franchise investment: capital and sweat equity. The capital investment is the money you pay for your franchise agreement, plus ongoing royalty payments (you'll also need to invest in equipment and have enough capital to pay the bills until you return a profit). The other part of your franchise investment is the time and energy you put into running your business. A franchise investment is not a passive investment. You don't generally write a check and sit back and collect money. Your management of the business will have a huge impact on your profits.