Our guide to valuing a magazine business is available to download – FREE – for everyone who requests our franchise information pack.

Magazine businesses are different to a lot of industry types.

Some of the most obvious differences are the intangible elements that accompany magazines.

For example: the main product sales come from advertising space, which is not a physical thing.

This is an advantage in terms of not requiring warehouse space, non depreciating and costs next to nothing to ‘manufacture’.

On the other hand, magazine advertising space can’t be re-possessed if your clients refused to pay you – so having a robust credit control and accounting system is essential. So many magazines go out of business being owed thousands by non-paying bad debtors.

ViVo Magazine has a successful credit control and accountancy model that has produced top class results in terms of generating prompt payments from our advertisers.

The media industry has been well known for paying inflated prices for certain acquisitions. But magazines – the printed kind – are in a state of flux. Unless, that is, you happen to be running a magazine in a high growth market sector – such as luxury or hyper-local!

Integrating digital media with traditional media is key to success.

Magazine readers still go online and people who go online still read magazines – so simply offering both audiences a ‘one or the other’ option is a flawed strategy. A joined up digital and traditional media delivery system is integral to producing solid long term results from your magazine business.

ViVo Magazine franchisees benefit from full media business training and access to the latest reports, technology and multi-media in order to always keep one step ahead of the game.

Should an exit via business sale form part of your plan, perhaps as an early retirement strategy, franchisees are entitled to sell their licence/magazine(s) as a going concern should they find a suitable buyer.

To give an indication of what your ViVo Magazine could be worth within just 3 years you need to factor in the anticipated turnover and profits plus the desirability of your client base and indeed your audience.

Media businesses, as a general rule, tend to be valued higher than businesses which carry stock or rely on large numbers of skilled staff so the potential for gaining a lucrative sale price is increased with a ViVo Magazine franchise. This is even more relevant when the business is part of a tried and tested franchise model, it decreases the risk profile for any potential buyer.

For the purpose of illustration, if you built your ViVo Magazine up to a portfolio of two publications plus a social networking website added to the mix, had a turnover of £250k, it is certainly realistic to place a valuation of at least 3 or 4 times annual earnings.

You could be selling your ViVo business for a six figure sum within a relatively short period of time, should you wish to do so, if you have been successful at building the financial profile of your franchise.

Alternatively, you may wish to recruit your own manager(s) and simply enjoy the profits of your early labour. There is absolutely no doubt, if you put the time and effort in with your ViVo Magazine business you should be very well off or in a position to never have to work again within just 5 years.

For example, you’re starting the best ever streetwear magazine known to mankind.

Let’s assume all of your streetwear loving friends will read, let’s assume WH Smiths will stock the title and let’s assume that Adidas, Nike and Reebok will be falling over themselves to advertise in your title.

You do your business plan, you research the market for streetwear and you list all of the potential advertisers who can help your early cash flow requirements.

You project conservatively, you believe, and you work out that whilst you might only make a small profit to begin with, in years two, three and four, the multiples on profits are amazing.

Here’s the reality.

When you pitch your new magazine, the big brands will ignore you.

They might be nice to you and tell you to keep them in the loop, but they won’t put money in.

Some of them, might – only might – let you put an advert in for FREE (yes, the big brands who fuel the advertising market don’t even say yes to free adverts every time) so your plan for putting a free advert in your magazine on behalf of Nike in an attempt to trigger a domino effect to encourage the smaller brands (or Nike’s competitors) will fall flat when Nike refuses to let you put their treasured brand in a publication they simply do not know.

Secondly, the medium sized advertisers will want to see a sample/dummy copy of your magazine. Obviously to produce this you will need to spend money.

Now you have a dilemma. How much time, money and effort are you going to put in to this dummy edition?

Have you hired a designer? Outsourced the job, perhaps? Paid for a small print run? Commissioned/written the editorial?

How much money are you going to invest in your dummy edition?

Try and do it on the cheap and you’ll put more advertisers off than you ever attract, go all in for a stunning sample, that’s money you’ve got to find and you still won’t the big brands because they are very shy when it comes to launch magazines from small/independent publishers.

As a magazine publisher, you hit a cash flow crisis before you’ve got your first issue out of the door.

What about if you’ve secured investment?

I speak from experience – I’ve launched several magazines – you will burn through cash in your early stages so fast, your life will become very, very stressful. It’s a lot like watching an egg timer, you fight desperately to reach profits before your cash runs out and even when you (finally) do hit your profit, you still have to fight hard to get parity with the money you already spent.

It’s incredibly easy to spend £250k before you produce your first issue making £10k in profit.

Launching a magazine is like launching a ship, once you set sail, you can’t stop, can’t turn round and are entirely reliant on sailing conditions being in your favour. Of course, if you happen to be a skilled captain behind the wheel of a super-tanker, life’s easier.

This is why it’s far easier to be given the wheel to your own super-tanker rather than trying to build your own from scratch. This is why it’s far easier to be behind the wheel when you have instant access to those experienced captains who can easily point you in the right direction the second you need it. This is why franchising a magazine is – in my view any way – 100,000 times more likely to reduce financial and personal stress in comparison to trying to get your own title off the ground.

1) You don’t need to hire an editor
2) You don’t need to manage a team of writers
3) You don’t need to hire a chief designer
4) You don’t need to manage the advertising design for your clients
5) You don’t need to worry about the opposition from potential advertisers as your magazine brand is established

There are LOTS more benefits.

Apply for our free franchise prospectus and we’ll outline the many advantages.

Literally millions of people interact with magazines every day and as careers go, the media industry is one of the most over subscribed on EARTH.

So how do you make a move that will get you the very best of both worlds; running a magazine, with a ready-made audience that makes you money and enables you to lead a genuinely enthralling lifestyle?

Simple – you acquire your own magazine franchise.

The benefits are tremendous:

• The risk profile in comparison to starting up from scratch is eliminated
• The ‘grunt work’ such as negotiating print prices, production, design etc is all done for you
• The tap in to expertise from people who’ve been there, seen it, done it in magazines is invaluable
• Unlimited revenue opportunities from virtually any market sector (due to the desirability of the audience)

Get your magazine start up guide today!

We’ll also send you a FREE eBook on how to harness the entrepreneur mindset.