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Updated on July 6, 2007.

IF YOU THINK BUYING A franchise sounds like a good way to make a bundle as you ease into the world of entrepreneurship, you could be right. The basic idea — taking someone's proven business model and executing it — seems like a pretty safe bet, especially if, along the way, you can cash in on the success of a big-name brand and get training and guidance from a giant company run by experts.

Although few comparative studies are available, a report by researchers at the University of New Hampshire's Whittemore School of Business and Economics suggests that, over a 10-year period, franchise companies in the restaurant industry significantly outperformed their non-franchise competitors.

But don't think it'll be a quesadilla-walk. What many prospective franchisees don't realize, says Matthew Shay, president of the Washington, D.C.-based International Franchise Association, is that running a franchise can require just as much effort as running your own business. Depending on the industry or segment you're in, it can take months or years before your operation is profitable. Outside of the long hours and intense dedication a franchise requires, there's the possibility of getting tangled up in a protracted, expensive legal battle with your parent company. (See sidebar on next page.) "It's just like any other business," he says. "It's not a sure thing."

Here are some things to consider before taking the plunge.

1. You should deal well with authority.
Franchisors prefer working with people who can follow the rules, rather than true entrepreneurs, says Jeff Elgin, CEO of FranChoice, an Eden Prairie, Minn., consulting firm that coaches people in choosing a franchise. If you've got strong feelings about everything from the kinds of products you'll be selling to the color of the walls, you might consider starting your own business rather than buying into a franchise. To see if you're cut out for franchising, try FranChoice's personality test.

You should also think hard about your work habits and people skills. Would you be comfortable working the hours a chain requires — potentially late nights, early mornings or any other time there's an emergency or an employee doesn't show up? Even if you were a corporate manager in a previous life, managing hourly employees at a franchise location can come with a new set of problems — like language barriers, high turnover rates and absenteeism. If managing people isn't your forte, you might need to hire a general manager for your business, assuming the franchise allows it.

2. Do you have the cash to buy into the franchise you really want?
Franchisors are looking for people who have at least $20,000 in liquid capital (a combination of cash, securities and home-equity), about $100,000 in net worth, and an impeccable credit history, says Elgin. And those figures are probably on the low end. If you have $50,000 in cash, your investment possibilities increase greatly, he says, and you'll have more leeway to pick a company that matches your preferences and personality. (To figure out your net worth, try our calculator.)

Many companies post their franchise fees on their Web sites, and overall startup fees can vary widely. Subway, for example, charges a franchise fee of only $12,500 — but the sandwich chain estimates total upfront costs could range from $87,300 to $218,800. Cold Stone Creamery, the Scottsdale, Ariz.-based premium ice cream shop chain, charges a franchise fee of $42,000, with initial investment estimates of between $267,300 and $399,600.

So how much do you stand to make in the long run? It depends, of course, on how well you execute the franchisor's system, how fast the franchise idea takes off in your area and other costs, like annual fees you pay to the company.

While it takes many franchisees two years or longer to turn a profit, there are exceptions. Valerie Waitley, a former volleyball coach, fell in love with Curves, the Waco, Texas-based women-only fitness chain, while she was living in Hewitt, Texas. Curves is one of the fastest-growing franchises in the world, with more than 9,500 locations globally. In the U.S., according to Curves founder Gary Heavin, new franchise opportunities are "sold out" — meaning you couldn't start a new Curves location in your town if you wanted to. But in 2000, when Waitley and her husband moved to the Tacoma, Wash., area, there were few Curves gyms around, so Waitley decided to invest in two (she and her husband Tom now own nine). The first club's startup costs were around $35,000, she says, and it took around six months before she made a profit. But by the time she and Tom opened their third and fourth clubs, the Curves idea had caught on, Waitley says, and they fully recouped the initial investment costs within a week.