Security makes no noise - but you can hear opportunity knocking loud and clear. The last decade brought you a new kind of security: Being in business for yourself! It's not a quiet visitor, nor is it going away. Especially in the form of franchising. Security as you've known it has been a secure job with benefits, an exact amount of income and a slow but predictable growth in your career. The old "security" revolution has taken advantage of your expertise and years as you willingly and happily trained your successor, even if unknowingly,- who might be half your age or possess more letters after his name than you do, but most assuredly will command far less salary to fill your shoes. That's business! Or at least that's how it is if you don't own the company. Even if you've make it to the executive washroom clique, the new rules -or lack of them- prevail in American big business today. Corporate profit agendas have nearly eliminated upward mobility and tenure of job security.
America, while the first country to fall unaware and unprepared into this diminishing job market, can sound the alarm to the rest of the world. Many countries are now facing extreme economic changes and are already experiencing similar corporate job eliminations. Smaller companies are being pushed into the same predicaments. Even blue chip investments - real estate, C.D.'s, Treasury Notes - have lower rates of interest earned, higher rates of lending and don't provide enough security to a displaced executive. And, the risks are greater than ever that previous loyalties in jobs, skilled labor and even executive careers will keep diminishing! Skilled professionals suffer the same dilemma. Larger groups of professionals (like doctors, accountants, attorneys, etc.) are pooling their strength to afford them some stability and control, making it next to impossible for a singular professional to enjoy the monetary benefits as well as the control of his own destiny.
"Entrepreneuring" has come into its own. It is the most viable answer to financial and career security today. Socio-economic indicators reveal the greatest affluence abounding in predominantly private entrepreneurial sectors than ever before. The tax advantages of owning your own business are very attractive as well. More people are now drawn to the independence of business ownership as a control factor over their individual personal lives and desired lifestyles. Franchising is a special kind of entrepreneurship.
Franchising - not a new sector in entrepreneurial ventures, but not yet a well understood venture, is providing a new kind of security. The security of investing in yourself. Your future in franchising can open the now locked doors to many missing amenities and provide real security at the same time. Just how much security do you have now? What guarantees does your job or profession possess? Can you be replaced or pushed under by bigger companies or new graduates having advanced knowledge or skills and requiring a much smaller salary? What kind of security are you looking for? How much do you need or want? Money? Growth? Recognition? What skills, talents, assets, etc., do you possess that will give you what you deserve? Carefully examine your answers. Are there options?
Yes! Franchise outlets now get 52 cents of every retail dollar spent in America today and is expected to reach 65 cents by the year 2012. Franchising affords you an opportunity to be part of this growth pattern, breaking all precedents for security and longevity. The fatality rate is unbelievably low with survival and success rates currently above 90% to 97% (depending on who's survey you read)! Best of all, in most cases, experience isn't necessary and neophytes are preferred. While general experience in management or supervision may be a plus, it doesn't have to be in a related field to the proposed franchise. Some franchisors even allow absentee owners. Real estate developers are aggressively seeking franchise operations as tenants, Attractive store designs, mature business tactics, success rates, unique and reliable selection of goods or services; this and more has captured the interest of landlords. Franchising promotes consistency and reliablity for customers and franchisees alike.
Experience is the Best Teacher: Now you can buy it! Imagine "buying" the expertise of well known successful entrepreneurs who risked everything to develop a proven system. You may decide on a large older franchise system or you may be given a ground floor entry in a new franchise system at a much lower investment premium but with just as much propensity to succeed. Regulations, education and the overwhelming success ratios of all franchisees provide you with all the information you need to make a sound decision in your choice of franchise opportunities. Fortunately, many franchisors prefer you to have little or no experience (or preconceived notions) in their respective industries.
Time, Temperature & You: There is no perfect business, no perfect time to go into business, and no perfect person to go into business, but there are indicators. You must look at all factors that might affect the particular category you are investigating. Sources are unlimited today (check the source of your sources, too)!
Make Me an Offer I Can't Refuse: It takes two (or more) to franchise. You need to know what you can offer a franchisor. While it is important that you are not under-capitalized to purchase the franchise, it is just as important to evaluate your skills, talents and other assets. The franchisor may be more interested in what else you are bringing to the table beside your money. Sometimes the difference can be made just by communicating your own desires. Identify what it is you expect and need from a franchise other than monetary rewards.
To Be or Not To Be - A Franchisee: Franchising is not for everyone. You must familiarize yourself with franchising - what it is and what it is not! Business opportunities "Biz Opps" are not franchises without fees. Generally, "Biz Opps" fail into the same category as all non-franchised businesses, which have an overall consistent failure rate of more than 90% in the first five years of operation. You must talk with an experienced franchise and business advisor to really understand the difference. If you honestly believe you can do better or be better off without a franchisor's support, guidance, expertise, management, assistance, methods, buying power, research, development, name, image, etc., -and you may be right- then you must say no to franchising.
YOU CAN'T PAINT THE "GOLDEN ARCHES" GREEN! However, along with all the amenities above come restrictions and controls. Each franchisor has set standards, that you as a franchisee must meet, to insure consistent quality control and maintain the proper image. A superior quality retail franchise (by contract) would not allow you to compromise your reputation or the franchisors' or other franchisees' positions and image by permitting you in any way to sell lesser quality goods or services at your franchise establishment. Likewise, in some franchises, no franchisee may change formats or color schemes, or add or diminish product lines and services, hours of operation, sales methods, etc.
Not A One Way Street: A Franchisor has to make strong contract commitments to you as well. While a Franchisor requires you to buy some or all goods or services from the Franchisor and not outside sources, he also sacrifices a vast profitable market he could have by selling his system's products or services to the general public or to your competitors. The value of the Franchisor's buying power is passed on to franchisees, and often meets or exceeds a great portion of the franchise fee.
Who's the Boss? Any, or all- and more of these requirements, are committed to by contract if you become a franchisee. Now let's examine why. A franchisor has almost always invested many times over the amount of money, time, commitment and risk that you will be asked to invest. He wants to protect his investment, image, name, product, and future, just as you do. A franchisor must not only succeed in his own "store", but he must provide you with the same systems and quality for you to be able to do so. The only way this is accomplished is for the franchisor to have legal control over each franchise. Then each franchise is comfortable that no matter where a consumer purchases a product or service, they are assured of consistency of quality in the products or services of that franchise. The Franchisor is not your boss. You are the boss, with certain restrictions that are for your benefit and the benefit of all franchisees in that franchise system. Yes, the Franchisor benefits too, but only if the franchisees succeed.
I Do! The commitment of being in business should be a burning desire in you, sometimes filled with fear and anxiety, other times full of confidence and pride. These combined feelings are the mark of successful people everywhere in all phases of fame and fortune. But without the commitment and the necessary actions on the franchisee's part,, only complacency and mediocre success preside. So take yourself by the hand and go through as much fear/confidence as you can stand until you decide if you do or you don't want to be in business for yourself in a franchise opportunity.
Apples, Oranges, & Kumquats! At least they're all fruits. But what if you've made the decision to invest in one of several kinds of franchises? If you've read the right books you know that the part of franchising that attracts you is that you don't have to have a background or experience in the product or service a franchise offers. You can be trained under the franchisor's guidance and system to duplicate a successful business. But, how can you compare a maid service franchise with a food franchise or a retail product franchise? Complicating matters are such factors as finances, location, territories and leases or even franchises slightly different but in the same category. Each franchise has unique appeal. Investigate and "look to see" if any true "love of labor" of yours can be incorporated into your franchise. Perhaps you have a true talent in writing or art or computers or communicating with people. Ask the franchisor if he is open to receiving and making use of your talent, even if in a small way. This is part of what can ensure a creative channel for a person who needs this dimension in a business of his own, but never had an outlet for it before.
The Three R's- Read, Re-Read and Read Again! Read every piece of literature that you receive from a franchisor three times. The first time relax, just get the overall gist. The second time (with pen and paper in hand), read it and write out any questions or concerns. On the third reading, try to answer your own questions. Especially with the legal documents, it is important to fully understand not only what is committed to in writing but what is not in writing if it conflicts with any other written information or statements made by the Franchisor company. Today, all franchise documents are required to be written in "plain English". Take the contract to a business or legal professional if you are planning to proceed with the franchise investment.
It's Not My First Choice: Going into business can be very unsettling. The horrors of not receiving a steady paycheck can make taking one or more steps downward in your career ladder marginally acceptable. Once you choose the challenge and rewards of franchising as an alternative to your "job" predicament, your second choice - a well selected franchise, might provide the security you want and that ultimately will be "your best choice". With that choice there is still risks, but greatly reduced if you choose a good franchise match.
Straight From The Horse's Mouth: By all means discuss your expectations and concerns with several franchisees in the system before you decide. Talk to franchisees of low, medium and high levels of gross revenue to find out why their levels of success are different. Try to define the personality characteristics that the franchisor prefers. Gauge such things as labor intensity, down-side risks, tax positions and rights of first refusal on territory or unit expansions. Make use of mentors as devil's advocates. Keep an ongoing list of positive and negative questions and answers. Take those questions, satisfied or not, to people you trust and note their answers. Carefully compare all answers and notes. You may be pleasantly surprised to find that the results of this intense format has brought you to a confident decision.
I Pledge Allegiance To Myself: The lawyer, accountant, and banker of your choice maybe instrumental in providing you with questions. They can also be a good source of devil's advocates. They should, of course, base their advice on fact. Your attorney's job is to be certain you understand the contract in its entirety. Your accountant's job will be to help you understand the mathematical implications and components as pertains to the investment, and your banker's job is to critique and identify your financial posture with regard to the investment. In all cases, these professionals should give you your options, expose the risks or liabilities and then offer advice. It is your job to make the decision. Don't place that responsibility on any other person.
Pull the Trigger & Shoot Straight: Once you've decided which franchise is for you, take care not to lose sight of your objectives or the franchisor's. Methodically and meticulously follow the outline the franchisor has set up for you to start or open your franchise. Aiming is only part of the entire process. You must then put the plan you've chosen into action by pulling the trigger.
The Sweet Smell of Success: As your franchise takes shape, set realistic intermediate goals. Being the best franchisee of a particular franchise has many rewards, and sharing your success story with oncoming prospective franchisees is a reward in itself. Of course, there will be many obstacles to overcome also. Taking those obstacles will be much easier if you ask for the advice and assistance of the franchisor and other successful franchisees. Friends and associates can also be supportive if you share your newly-adopted philosophies and successes with them in the beginning and as you progress. Don't wait to approach them until you hit a bump. Let them help you by reminding you of all the time and energy you spent climbing this hill and how good it is to be this far up. Looking back as you climb with that attitude will help you overcome the bumps to come. This may be your first hill, but I assure you the flowers way up on top smell the sweetest and are well worth the climb!
The Best of the Best! As an American model of free enterprise and of owning your own business, franchising is the best of all worlds for ambitious, talented and motivated investors. Franchising, the best opportunity of all entrepreneurial pursuits, provides a fail-soft security and a rewarding, challenging outlet for your business talent without the inherent risks of today's unstable job options or other speculative investments. Franchising is the "best of the best" opportunity of investing in yourself and the newest "security blanket" for your future!
The above is an except from the CD book, "Franchising Made E-Z".
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