Time to lose weight, find a hobby, work out, spend more time with friends and family, get a new job…and the list goes on. It must be the New Year; a time when most of us feel the urge to tweak our lives and revisit our goals. Too bad that next year’s list will look nearly the same for most. But it doesn’t have to be that way, especially for those who dream of owning a business.
Get started by researching your resolution. Understanding yourself is an important first step in exploring business ownership. For people who want to be their own boss, but don’t have a business model or product in mind and who don’t mind following someone else’s path as long as it’s one that leads to prosperity, franchising can be an excellent option.
When it comes to franchises, part of that exploration process is to debunk myths associated with them. As a franchisespecialist, the top ones that I hear frequently are:
1. Franchises are Mostly Restaurants: Not so…more than 3,100 different franchise concepts exist in 90 different industries, including home repair and improvement services, pet care, education and child care, commercial cleaning, marketing, advertising, health and fitness, staffing services, and IT.
2. Low Cost Means Low Return: Many of the higher priced franchise concepts (over 100K) require a higher degree of investment because of real estate, build out costs, staffing, and additional overhead costs. With a lower cost franchise, you will probably be looking at fewer cost factors but still be providing services that people or businesses will pay a premium for.
3. Need Lots of Start-Up Cash: Franchises are more affordable than you think. In some cases, only $50,000 liquid capital is needed. According to a 2010 study conducted by FranData, a full third of all franchise opportunities actually cost less than $100,000. Also, a variety of financing options exist including SBA loans and even specific 401k and IRA rollover plans that allow funding a new business tax-free and penalty-free.
4. Require Industry Expertise: Many franchisors are not looking for franchisees who have worked in their field. Instead, they want people who are open to learning and following their franchise model and who have acquired skills and experience through their former jobs that will propel the franchise forward.
5. Are 24/7 Operations: With so many franchise options to choose from, there are concepts that fit different lifestyles. Some can be done from home, some on a semi-absentee basis (for example, 5-10 hours per week), and some from 9-5pm. In fact, more and more people are leaving corporate jobs for franchising, so they can make a living and achieve life balance as their own boss.
Myths aside, researching your resolution will also help demystify the process. There are many good books and resources to help you ask the right questions. A few must reads include E-Myth by Michael Gerber and Street Smart Franchisingby Joe Mathews. Entrepreneur Magazine and Franchise Business Review are also good resources.
But don’t go it alone. Consider finding a franchise advisor. These consultants have valuable insights and experiences that are normally free for potential franchisees. They will walk you through the steps and ensure you end up with a business that most closely fits your needs, goals, skills, and means and also provides the best return on your investment.
If you start now, it’s possible that you can be running your own business by next quarter. Best of all, you’ll be able to cross at least one big resolution off your list.