You may have just noticed a small pattern here. Where is the Top-5 list? Or the Top-10 type lists which propelled David Letterman’s nightly ratings? Research has shown that many readers, overwhelmed with these usual numbers, often tune out titles with common numerals which comprise the lists. In fact, researchers have found that readers pay much more attention to non-standard numerical lists. Perhaps that’s why Stephen R. Covey’s “7 Habits of Highly Effective People” became a blockbusting bestseller.

In keeping with this theme, FranNet is proud to bring you, the reader, the “Top-8 Franchising Do’s & Don’ts”.

 
DO…develop a business plan before you sign on the dotted line. It has been stated before in our blog section that choosing the right franchise opportunity which matches up best with your skills and experience is the single-most important decision you will make in the entire process! Heavy consideration should be given to every angle of your new opportunity. Once this all-important decision has been made, you simply MUST create a viable and workable business plan to support your efforts. There is an incredible amount of information available via the Internet to help you get started. A logical place to begin is the business plan resource pages of the U.S. Small Business Administration (SBA) or its video on franchising.

 
DON’T…just breeze through your Franchise Disclosure Document. Read it carefully and read it thoroughly. The presentation of this document is a mandatory step in the franchising process and is designed to protect the prospective franchisee from unknown variables.

 
DO…have an exit strategy for your franchise business—before you begin operations. Consider whether or not you want to will the business to a family member, sell it or even expand to multiple franchises. Choose wisely…but be sure to have your choices in order.

 
DON’T…ignore your instincts. If you’ve arrived at the precipice of franchise ownership, you clearly trust your intuition to have gotten you here in the first place. If something—anything—feels out of step in the process, stop and ask questions. Get clarification. Don’t be afraid to go the extra mile in protecting yourself during this intricate process.

 
DO…consult with your family throughout the process. Owning a franchise is often a decision made with your loved ones in mind. Many are designed to give the proprietor the freedom to spend more time with family—and in some cases leave a lasting legacy created to provide financial security. Consult with those closest to you and rely on the informed decisions you make together.

 
DON’T…rush into anything. As a potential franchisee, time is on your side. You have the right to make an informed decision. Beware of any “hot-box” tactics designed to speed you through a franchise process. A reputable franchise consultant will proceed at the pace you set, not the other way around.

 
DO…investigate a franchise concept that you are going to love. With over 3,000 franchise concepts, there simply has to be one that speaks directly to you. While many potential franchisees rely on their past business experience to guide them into their own similar franchise opportunity, you can still investigate the type of business you always wanted.

 
DON’T…begin the franchise ownership process without proper guidance. FranNet is dedicated to matching your best attributes with a franchise where you should have unbridled success. Our consultants are dedicated experts in this field. And the best part of all? Their advice to you is free and contains no-obligation throughout the entire process.

 
Do you feel that you’re ready to get started? If this article has inspired you to investigate a franchise opportunity, perhaps it’s time for a free consultation with a qualified and experienced franchise consultant. As it turns out, FranNet is just the place! As a franchise consultant company with a great track record of assisting individuals on their path to business ownership, make arrangements to speak with one of our representatives today.

For those who have beefed up on their franchise research over the past few months or years, the time to take that all-important first step has certainly not waned. There is much evidence to back up this claim. Consider the recently released report by the International Franchise Association. Here are some great conversation points:

- Franchising sales rose 1.5 percent in the 2012 calendar year, at a rate of 1.4 percent growth is expected through 2013.

- The number of jobs created by franchising is expected to rise 2 percent over 2012 figures, from 8.1 million to 8.3 million employees.

- The gross domestic product of the franchise sector is projected to increase 4.1 percent in 2013, from $454 billion to $472 billion in annual sales. This represents 3.4 percent of the gross domestic product figures for the entire United States economy.

- The output of franchised establishments (in nominal dollars) for 2013 is expected to rise 4.3 percent—from $769 billion to $802 billion.

All of the aforementioned figures make a pretty good argument in favor of stating that the good times for franchising have yet to peak. And that has kept the lines of communication open for companies such as FranNet, who specialize in franchise industry placement options and financing.

As we have seen in a previous FranNet blog posting, there are several key franchise concepts that do well in any type of economy. Included in these franchise listings are franchises related to Senior Care, Home Repair, Essential Services (think haircuts!), Professional Services and Health & Wellness concepts.

Keep in mind that deciding to opt for a further discussion of franchising is an important first step, but finding the right opportunity is the most important decision to consider. Always keep in mind the key benefits of franchising over other small business opportunities: You get to work with an established brand, receive exhaustive training, are provided continuous support and—best of all—you get to be on your own.

And isn’t that why you likely considered the franchise route in the first place? We can tell you from our experience, it’s a reason we hear quite often from our clients!

Do you feel that you’re ready to get started? If this article has inspired you to investigate a franchise opportunity, perhaps it’s time for a free consultation with a qualified and experienced franchise consultant. As it turns out, FranNet is just the place! As a franchise consultant company with a great track record of assisting individuals on their path to business ownership, make arrangements to speak with one of our representatives today.

In preparing for the Battle of Fredericksburg, they badly underestimated just how dug in and fortified the Confederate positions were. As company after company crossed the river in boats in preparation for the upcoming fight, many of the officers and men in the Federal camp were amazed that there seemed to be little or no resistance to their initial advance.

Then, a lowly Private in one of the boats made an educated guess, which foretold of the impending disaster by stating, “They want to get us in good and close. Getting out won’t be so smart and easy.”

Over the next two days, Federal troops were soundly defeated, with over 17,000 killed, wounded or missing. And much of the slaughter could be traced back to their lack of a cohesive exit strategy.

The same holds true today when it comes to the consideration of business ownership. While it has been stated previously in this blog series many times before, the single-most important consideration is choosing the right type of business. If done properly, this will determine your roadmap to success. However, equally important should be your long-term plan for strategizing an exit or transition once the business objectives have been fulfilled to your own personal satisfaction.  

Dr. Stephen R. Covey, author of the immensely popular best-seller, “The Seven Habits of Highly Effective People” echoes the value of exit strategies by outlining his views in Habit No. 2: Begin With the End in Mind. This important concept holds that you, as the prospective business owner, must be able to envision the proposed destination of your plan, start to finish—and remain proactive enough to see it through to the finish line. Covey clearly states that the easiest way to accomplish this method of thinking is to write out your Personal Mission Statement. And that includes covering all of your bases from the inception of your plan all the way through to a carefully crafted exit strategy.

What you need to know is that having a well-thought out exit plan is going to shape how you will both build up and run your business. Keep in mind that when you begin the effort to author your all too important business plan, an exit strategy should receive a Roman Numeral of its own. Americans are living longer and healthier lives. And your business should have just as healthy a life, as well. Below are the three main options for a well-crafted exit strategy of your business:

Selling Your Business

This is a very attractive option because it raises the specter of “cashing out” once the business has built up valuable equity of its own. If you begin a business with the outlook of one day selling it for a profit, deciding and knowing when to pull the trigger will be a concern. However, if your exit strategy calls for a set amount of time to elapse prior to the sale — say five or ten years — stick to your plan and prepare to reap the benefits of your hard work.

Running Past Retirement

The United States has an official retirement age, but these days it is becoming an oft-ignored date. As previously stated, people are living longer and healthier lives and often times obtain much enjoyment from running a successful business into their golden years. Perhaps then, you intend to stay on and direct efforts while considering family members as natural successors. Inheritance in this case can mean a well-developed business in addition to other financial holdings. And there’s nothing wrong with keeping things in the family, provided that the initial business plan and direction are continually in line with the original details.

Taking a Step Back

Another popular exit strategy—especially in the franchise world—is having the ability to step back and allow another individual to lead your business efforts. Ownership is retained and, in effect, you have the option to bring in a qualified candidate in order to “Manage the Manager.” If the right match can be found, whom you will entrust to run the day-to-day dealings of your business, you will have increased leisure time while your equity continues to grow at the pace you are directing. This tactical method is also referred to as the “Semi-Absentee Model” in the franchise world.

Hopefully you now have a clearer understanding of just how important an exit strategy can be in relation to your overall business plan. Make it a vital part of your strategy from the outset and you’ll be in position to benefit from the equity you will have built up over the life cycle of your business or franchise.

Do you feel that you’re ready to get started? If this article has inspired you to craft an initial business plan with a well-thought out exit strategy, perhaps it’s time to talk with a qualified and experienced franchise consultant. As it turns out, FranNet is just the place! As a franchise consultant company with a great track record of assisting individuals on their path to business ownership, make arrangements to speak with one of our representatives today.

As consultants at FranNet, we believe that reviewing and researching the subject of small business ownership and franchising is an ever-evolving matter. We simply cannot stress the value of independent research prior to making some of the most important lifetime decisions. We’ve stated before that finding the right match for your experience and abilities is the single most important factor in the potential for your future business success. And with that thought, we’re happy to recommend a reading list of two very important books which command a great amount of respect in our industry. Below, we offer a brief synopsis and highlight some of the most important lessons of each title. If you’re poised to make a move in the near future, you’d do well to have these books on hand prior to signing on the dotted line.

“The E-Myth Revisited,” by Michael Gerber
What is the E-Myth? Strictly speaking, author Michael Gerber is making a concise point that many entrepreneurs—the “creative and idea” types—make lousy businesspeople. The premise of the book is based upon solving this rather surprising dilemma. In each chapter, Gerber sets out to design a road map for success in any environment by delineating each and every factor necessary to bring about significant business accomplishments. Primarily, the author establishes a very detailed plan which drills down to the day-to-day level of job necessities, which—if followed to the letter—offers an excellent chance of business establishment, traction and then success.

Along the way, Gerber dispels many of the same business myths we’ve covered in past blog entries. In tackling assumptions, the author makes certain that his readers won’t fall prey to the common pitfalls which can so easily be corrected with the right thinking, planning and implementation of successful strategies. The different stages of your business are covered from infancy to maturity, with valuable tidbits of advice designed to be easily understood. There is a particular emphasis on franchising in “The E-Myth Revisited,” as Gerber draws parallels from successful established brands and how these lessons can apply to your personal situation. Last, the author is keen to remind his readers that there are clear differences in inserting yourself into your business vs. working on your business in the long-term.

There is a reason that the best-selling “The E-Myth Revisited” has over 150,000 copies in print. It’s simply an excellent read for the burgeoning business owner in you. It’s on our official recommended reading list and is a part of all of our business presentations.

“Street Smart Franchising,” by Joe Mathews
If you’re looking to eventually own your own successful franchise, it makes sense to hear from those who have been down that road before. And “Street Smart Franchising,” by Joe Mathews, is chock-full of advice from numerous successful franchisees more than willing to share their prior experiences with the reader. Targeted directly to the entrepreneur crowd, “Street Smart Franchising” is a thorough collection of personal stories aimed at giving the next generation of franchisors a leg up on the competition. Simply put, it’s the “What to Expect When You’re Expecting” book of the franchise world.

With franchising, there will always be difficulties during the startup phase. But gaining valuable knowledge from successful business owners who were once in your shoes makes for an interesting page-turner. You’ll read firsthand accounts of the pitfalls, shortcuts, hidden secrets and unexpected circumstances of many personal business owners. And they’re happy to pass along their knowledge to the reader for the sake of eliminating common mistakes and misconceptions while growing your business.

The book also includes a particular focus on the thorough investigation process of franchise opportunities. Once again, it’s a valuable aspect that we at FranNet can never underscore enough. As with “The E-Myth Revisited,” “Street Smart Franchising” is on our recommended reading list. To borrow an old adage, it pays to do your homework.

You can own a copy of these titles by visiting Amazon.com or stopping by pre-owned outlet such as Half-Price Books. Arm yourself with the knowledge you’re going to need by reading these books today.

Do you feel that you’re ready to get started? If this article has inspired you to check out either of these book titles, perhaps it’s time for a free consultation with a qualified and experienced franchise consultant. As it turns out, FranNet is just the place! As a franchise consultant company with a great track record of assisting individuals on their path to business ownership, make arrangements to speak with one of our representatives today.

Say hello to the Franchise Disclosure Document, or FDD for short. Quite simply, it’s a legal document mandated by the Federal Trade Commission (FTC) designed to assist the potential franchisee through the due diligence process. The FDD offers incredible access and insight into a franchise and its operations. Every legitimate franchise must produce one. If a company doesn’t, remove yourself from discussions as quickly as possible. At its core, the FDD removes any emotion from the process. It’s required to be presented to you and once it’s been produced, spend careful and considerable time reviewing it.

Under FTC guidelines, the FDD must be presented to the potential buyer in the pre-sales process no less than 10-14 days prior to entering a contract or paying any amount of money for a franchise. And as you’ll see, it may be the single most important document you’ll review during the entire procedure.

The required FDD paperwork includes the term “Disclosure” right in the title…and for good reason. Regardless of the type, size or scope of a franchise opportunity, the FDD follows a strict format. A franchise FDD is, in essence, a road map for reviewing the full opportunity’s legitimacy in the business world. FDD’s are uniform and consist of 23 specific items. You would expect that subjects such as franchise fees, initial investment totals and trademarks are covered. But the beauty of the FDD is in the depth of its contents. You’ll also read about assigned territories, renewals, restrictions and advertising efforts.

The FDD strives to give the potential franchisee the Who, What, Where, When and Why (or the five Ws) so that he or she can make the most informed decision possible before buying a business. Did you know that the FDD also includes a lengthy section concerning financial performance and representation? Sufficed to say, you’d probably like to know how much income you can expect prior to creating a potential balance sheet of profit and loss—and the FDD will have this subject covered in detail.

You also have a right to know if there is any pending litigation filed against a particular franchise group. This section includes even the most minute of situations, but also extends to the franchise’s executive officers. Of particular interest to most potential buyers are the specific territories offered. The FDD lets users know what’s open and what’s closed. And this is information you’ll need to know if you had the notion of opening a business right in your own backyard.

Perhaps best of all, the FDD should be perceived as expertly outlining each and all obligations necessary to enter into a business agreement with a franchise. You have every right to make the most informed decision possible when selecting a potential franchise opportunity. Under the Federal Trade Commission’s guidelines, the Franchise Disclosure Document is there to safeguard your journey. It accomplishes this goal by laying bare all of the requisite information necessary to make the best possible determinations when going into business for oneself.

Remember, the Franchise Disclosure Document is there to protect you, the consumer. In the most specific way, you’ll find out what is required of you and what is required of the franchise. That’s why it should be your own personal guiding beacon as you investigate an opportunity.

Do you feel that you’re ready to get started? If this article has inspired you to investigate an FDD as the best way to learn about starting your own business, perhaps it’s time for a free consultation with a qualified and experienced franchise consultant. As it turns out, FranNet is just the place! As a franchise consultant company with a great track record of assisting individuals on their path to business ownership, make arrangements to speak with one of our representatives today.

Generally speaking, there are three ways to go into business for yourself, including starting a business from scratch, buying an existing business to run or investing in a franchise opportunity. There are similarities in the two preceding examples, but as we will see, one of these three options has a much higher rate of success over time. Let’s take a look at the three distinct paths and delve into the pros and cons of each journey.

Starting a Business from Scratch

You’ve got a great idea for a business. You may be an expert in your field and ready to branch out on your own with the knowledge you’ve gained while working in a similar industry. You’ll certainly enjoy having complete control over your new venture. You alone will be making the decisions and reaping the profits, right? Then there’s the downside. You must come up with a viable business plan, make all the decisions (right or wrong) and create the financing and systems necessary to be successful. And studies have shown that it may take years to turn an actual profit.

Buying an Existing Business

A little bit safer alternative is buying an existing business. After all, the framework will already be in place and you may have historical results to fall back on. Buying an existing business makes you slightly more attractive to lenders because the establishment of your location, employees and systems should already be in place. However, what if your assessment of the opportunity is off? Small factors such as employee defection, a higher debt service and a lack of support from the previous business owner could hamper your efforts to successfully start the business further down the line.

Investing in a Franchise Opportunity

The final option for starting your own business may be the safest option of all. And why is this? Well, franchises are well known for providing the investor with a proven concept or service—often times with a well-run brand awareness effort. In almost every franchise option, there is a proven business model with well-heeled systems in place to predict future results. Adding to this positive aspect is the level of support you can count on from the franchisor and other franchisee owners in the same category. You’ll do well because they do well…and vice versa. The only drawbacks to this business ownership opportunity may be the endless supply of options you have to choose from, but don’t take this decision lightly. Matching your business skill set to a particular franchise is likely the single most important decision you’ll have to make. 

It’s time for revealing some interesting facts and figures that lend support to the franchise ownership option over the other two paths to business ownership. From 2006-2010, FranNet conducted a study to track the multi-year success rates of the three ways to go into business. A key finding? 92 percent of FranNet franchise placements were still in business after two years, compared to only 67 percent of other small business ventures (according to studies by the U.S. Census Bureau). After a five-year period, FranNet placements clocked in at 85 percent success rate compared to only 50 percent of other small businesses. What should you take from these statistics? There is innate value in matching an individual with their ideal franchise concept, because it consistently leads to a much higher rate of business success.

Do you feel that you’re ready to get started? If this article has inspired you to investigate the best way to start your own business, perhaps it’s time for a free consultation with a qualified and experienced franchise consultant. As it turns out, FranNet is just the place! As a franchise consultant company with a 25 year track record of assisting thousands of individuals on their path to business ownership, make arrangements to speak with one of our representatives today.

So why do so few take this proverbial leap of faith toward entrepreneurship? Two words—flawed thinking. Unfortunately for most, their conscience takes over and provides a litany of excuses, inaccurate predictions of impending doom and an avalanche of self-doubt. Sadly, these combined mindsets ultimately contribute to a complete backlog of unfulfilled promise and potential.

It doesn’t have to be this way. In striving to gain knowledge about the realities of going into business for yourself, you’re initially likely to bring into focus some of the leading misconceptions which prevent you from taking action. Let’s review three of the most common examples and address how they can be overcome.

At the forefront is money and financing. Most are under the impression that buying a franchise is going to take an inordinate amount of cash on hand or even a soon-to-be-turned-down bank loan. However the reality of this situation is much different than most people suspect. The federally-backed United States Small Business Administration has a wealth of knowledge and loan programs designed to dispel the erroneous notion of just how much capital it takes to get a business started. Did you know that of the over-3,000 different franchise concepts on the market today, nearly a full third of them have an investment range of only $50-100k? The further you investigate the unlimited options of money and finance in the small business world, the more you’ll become convinced that the requirements necessary to lead you on the path to entrepreneurship should not be viewed as a stumbling block.

Security is another leading factor in the flawed thinking which prevents individuals from taking a chance on owning a franchise. The thought of giving up a steady salary, benefits and even matching retirement funds is often too much to consider losing. But, in reality, you may not have to give up your “day job” in order to get your dream business off the ground. In fact, many business advisors even recommend this approach. Sure, there may be an increased workload for a set amount of time, but creating a thriving business with a safety net is well worth the trade off. Furthermore, many franchise concepts are specifically designed to meet this risk-averse approach.

Last but not least, it’s good old-fashioned fear that keeps most would-be business owners on the sidelines. Fear of the unknown and a fear of failure top the list of flawed thinking. However, research has shown time and time again that well-prepared individuals determined to succeed in a particular business or franchise field can do so—especially those with a meticulous business plan and a commitment to follow through on it. Risk reduction is real and the calculated resources pledging assistance to this concept run deep throughout all the pro-business and pro-franchise worlds.

Nobody can take that all-important first step but you. But when you do, you may find yourself walking alongside a legion of others—all of whom used to have the same kind of flawed thinking that once kept them from achieving their dream of entrepreneurship, business ownership and success.

Do you feel that you’re ready to take that first step? If this article has inspired you to investigate how to overcome the flawed thinking preventing you from business ownership, perhaps it’s time for a free consultation with a qualified and experienced franchise consultant. As it turns out, FranNet is just the place! As a franchise consultant company having helped thousands of others to change their mindset in positive ways, allow us to pass along encouraging wisdom on this subject by speaking with one of our representatives today.

For most dipping a toe into the waters of franchise ownership, there is an assumption that you will be trading one job/lifestyle for another. Surely a well-run business is going to take a full-time owner/operator, right? Well, not exactly. In the franchise world, which is designed to meet an adaptable working situation, there exists the “absentee” and “semi-absentee” business model. Franchise industry experts also refer to this concept as a “managing the manager” scenario. While it may not be suitable for every candidate, it could be your safer route to success. There may be less pressure to have the venture succeed quickly and you’ll have the luxury of being able to overcome obstacles at your own pace. All because you’ll be allowed to keep the safety net you depend upon—your day job.

Quitting a job in a sluggish economy is probably the last thing a successful full-time employee would want to consider. In fact, some might deem it downright crazy to leave the stability of a salary and benefits. However, with a semi-absentee model, you won’t have to worry about your peers questioning your sanity. It is possible to have the best of both worlds if you carefully research your business model and craft a stable plan for graduated growth. Some small business and franchise candidates may gravitate toward opportunities in areas where they already have experience, knowledge and know-how. In a semi-absentee business, this can be an important factor.

One of the first benefits you may recognize is the reduced concern of funding your venture. In addition to the working capital necessary to launch a franchise or small business, banks and lenders will see the supplementary financing as less of a concern with a working and salaried owner at the helm. If done correctly, you’ll always have your secured cash flow present while building out the future profits necessary to maintain your initial investment costs.

Keep in mind that growing a business on the side while you keep your day job must be done in phases. It may take a while longer to see the results, but during this period you will be operating with the safety net you’ve come to depend upon prior to your business launch. Remember when we mentioned “managing the manager”? Now would be a great time for you to begin your calculated search for just the right employee to shepherd your side business. While searching for the right fit, ask yourself if you can really “let go” of things and allow this manager to drive your business and subsequent profit margins.

Absentee and semi-absentee businesses can be a safer alternative while starting a successful venture. Locating and launching a valuable franchise opportunity while keeping your day job, your salary, and your benefits is possible to achieve. It’s perhaps a safer route, but it requires an intricate set of segments. Taken together, the venture will become a bit of a “balancing act.” And who among us would admit to a lack of this feature already present in our own lives?

Despite what you may have always been told, it is possible to have your cake — and eat it, too!

If this article has inspired you to at least investigate absentee and semi-absentee business models, perhaps it’s time for a free consultation with a qualified, experienced and local franchise specialist. As it turns out, FranNet is just the place to find one! As a franchise consultant company having helped many others to keep their day jobs, allow us to pass along some encouraging wisdom on this subject by speaking face-to-face with your local FranNet specialist today.

FranNet has seen the marked increase in franchise ownership interest skyrocket over this same time period. And when we meet these individuals, invariably one of their first inquiries centers on the economy — which franchises perform best in a down economy? While this is a great question, we look to franchise concepts which perform well in any type of economy. Below is our All-Star list:

Senior Care:
As the American ‘Baby-Boomer’ population ages, so does the need for their continued care and quality of life. People are living longer and healthier lives thanks to breakthroughs in health care medicine, technology and living arrangements. With the franchise industry loaded with senior care opportunities, candidates can focus on areas of business which handle home health care, non-medical concierge services and even spa-like adult day care centers. Statistical analysis tells us that senior care will remain a growth industry.

Home Repair:
The ‘handyman’ franchise concept is hot. Maintaining a viable home is work — hard work — in many instances. And in today’s world of cramped schedules, much of this upkeep can often go neglected. In many cases, some lost home equity may be recouped with the continued investment of upkeep. The purpose of the home repair franchise is designed to delve into extremely skilled labor such as plumbing and electrical fixes, as well as more mundane tasks that the homeowner either can’t — or won’t — be able to handle on their own. With a reasonable pricing structure and a guarantee of all completed work, home repair franchises are fast becoming a welcome option.

The ‘Essential’ Services:
There are some things in life that require regular service regardless of what the stock market is doing. Most people will need their hair cut every 4-6 weeks, your car will typically require repairs and upkeep and—suffice to say—you must eat on a regular basis! FranNet can direct candidates to dozens of franchises that fall neatly into this category. You may find running a small auto repair business, a beauty salon or a café/restaurant concept is the ideal franchise for you. One thing is for sure—your customers will be regular.

Professional Services:
In any economic environment, be it a Bull or Bear Market, the nature of businesses that provide services to other businesses will always be necessary. Since every business constantly looks for that competitive edge, professional services have become a vital service and a sought-after exercise. Business coaching industries and tutoring services are two of the most common examples. The beauty of this category is the variety of services offered. Investigate your greatest professional strengths and you may find a concept which lines up neatly with a preferred franchise service.

Fitness:
The trend toward healthier lifestyles is becoming a very common theme. Simply put, people are eating better, exercising more and taking care of their bodies like never before. A steady drumbeat of news, information and medical studies are propelling an interest in the fitness and health and wellness categories. There are several concepts that cover this ground from weight loss and nutrition to fitness and sports.

While the economy has presented us with challenges and forced us to reevaluate our financial futures, it’s nice to know that several business categories will always thrive in any type of economic environment. If you’ve been considering an investigation of franchise or small business ownership, perhaps this is yet another convincing point that will lead you to speak with a FranNet representative today.

Executives previously locked into so-called “safe” environments have found themselves alongside the bevy of recent college graduates—all scouring limited job opportunities rife with qualified candidates. In the most conservative estimate, it is proffered that—at a minimum—there are three candidates for every corporate job opening today. Facts and figures such as these have led to a sea-change in attitude. From those willing to initiate an investigation of small business ownership to the full-on “I can’t take it anymore!” crowd, it seems as if alternatives to working for others have truly been replaced by the attraction of working for themselves.

Of all considerations poured into the discovery and investigation of small business or franchise ownership, what is the one of the biggest misconceptions? Money. Specifically, the amount necessary to invest in a worthwhile opportunity that leads to financial independence. Ask most potential prospects and franchise candidates about the capital necessary to invest in their future and you’ll likely hear an astronomical figure that has no real basis in fact.

A full one-third of the more than 3,100 small business opportunities require an average buy-in cost of $50,000 or less. Add the fact that most—if not all—will finance the largest portion of funds necessary to begin. All of a sudden, a dream of franchise or small business ownership can be converted into a path leading to financial independence.

And there’s even more good news. How would you like for your initial investment amount to fall into the tax-free and penalty-free category? Well, it’s true. Funds from your personal 401k account can be “rolled over” to provide the capital necessary to get your franchise up and running. Without the dreaded “early withdrawal” penalty.  FranNet can point you to resources to understand your opportunity.

If you’ve read a surprising statistic or two in this blog, perhaps the time is right for you to consider a no-obligation consultation with a FranNet advisor. If you’re willing to pay zero dollars and zero cents for the privilege of receiving this advice, you’re what FranNet calls its target audience. In reality, franchising and small business ownership is not beyond your reach. And achieving financial independence on your terms instead of relying on corporate America is becoming a safer bet in these “new normal” times. Find out where you stand and how to unlock your finance potential in the world of franchise ownership today.

Connect with your local FranNet specialist right now to get a gauge on your business future. Simply click on “Request More Info” on the left side of this page.

By BEN HEINEMANN

John Blair, FranNet Director of Marketing/PR

The economy may have officially hit broken record status; every report or news story on the topic continues to state that it’s sluggish and isn’t picking up momentum anytime soon. However, what’s the same old news for everyone else means big business for the franchise industry and related companies. Coming on the heels of the news that FranNet, a franchise broker that matches people to the best franchise opportunities, made a gross revenue of 44 percent above its earnings for 2011, we sat down with the company’s Director of Marketing, John Blair, to learn more about why a sour economy means sweet success for FranNet.

1851: Why has franchising continued to be a job creator despite the rough economy?

Blair: It’s because of the rough economy that franchising has continued to be a job creator, and perhaps more importantly, a dream enabler. Corporate America remains at a standstill in terms of viable job creation; good paying, mid-management level and above positions. Plus, some companies continue to downsize in search of the proper balance of corporate overhead and profitability. That has left a vacuum of very experienced, seasoned business veterans searching for their next opportunity. Franchising presents that opportunity for them as it combines their entrepreneurial ambition with the structural support that franchisors provide. These former corporate folks are realizing that the best investment they can make is in themselves.

1851: You mention the vacuum left by companies downsizing. Do you find a lot of new potential franchisees or your clients are turning to the industry because they have been laid off from high-profile positions in traditional positions?

Blair: That’s exactly what we’re finding. This isn’t your parents’ or your grandparents’ corporate America anymore, and the executive workforce is responding to that. There are fewer and fewer opportunities in corporate America. And even in those opportunities that are still out there, the lifespan of a corporate executive is becoming shorter, now believed to be below three years on average.  So logically, those executives are looking ahead and asking themselves, “I may have to go through job transition again within the next three years?” That’s a tough reality to think through, especially when you figure families and children into their decisions. Franchising affords them the opportunity to take control of their future.

1851: How does the success of the franchising industry equal more revenue for FranNet?

Blair: FranNet is the premier franchise consulting firm in North America.  With the help of our proprietary profiling of our clients, we guide and counsel our clients toward franchising concepts that perfectly match their goals, strengths and budget. We work incredibly hard to ensure we find a great fit for that person, as well as for our franchisors. We work with so many well-respected, dynamic brands that are looking for their next top-performing franchisees.  As the franchising industry grows and the secret gets out of the bag about all the opportunities in franchising, FranNet sits in a perfect position to assist individuals in finding the best franchise for them.  Understand though, franchising can be a pretty overwhelming industry if one was to simply begin looking on their own due to the incredible range of opportunities available. We help focus that search , and in the meantime, provide excellent candidates to the franchisors for their growth.

1851: FranNet turns down about 200 franchisors per year who want to be represented. How do you decide on what franchises to represent?

Blair: We look for rock solid companies – financially, operationally and structurally. We demand a lot of our franchisor partners because we respect the relationships we have with our clients so much. FranNet is being given an incredible amount of responsibility in helping our clients find great fits for them, and that’s a responsibility we take very seriously. Just like our clients, we want to make sure our franchisor partners are set up for long-term success. We’re constantly vetting our franchise partners to ensure that we’re representing the best interests of our clients, as well as the best interests of our franchisors.

On being a sounding board
Cari Lyn Vinci, who’s based in Roseville, CA, discusses one of the most important roles in her position. “My goal is to enable clients to make fact based decisions. I am their sounding board. I tell them there will be roadblocks and the fear factor always sets in, but I will be there to help them through it.”

Helping people realize their full potential

Ted Fireman’s a FranNet consultant based in New Orleans, LA. He elaborates on how appealing being your own boss is. “Having grown up in a family with a dad that owned a small business, I appreciated the freedom he was allowed. Additionally, I have noticed throughout my career there are several people I have met that feel that their jobs don’t utilize their full intelligence and talents. Many are constantly dissatisfied, and want to be doing so much more with their careers. I really enjoy my job because I enable people to explore something different, to do something they feel truly passionate about.”

Being the local expert matters
Stacy Swift of Denver, CO mentions a key differentiator for FranNet is the location of its consultants. “We are the local trusted franchise expert. I could help someone buy a franchise in Miami or another city, but I do not want to. I do not know that area and would be unable to give them the best consulting services based on their geographic location. I like the face to face component. It is important for me to get to know my clients, and develop a personal interaction with them.”

Finding the right fit – even if the right fit is nothing
Pat Deering, based in Tampa, FL, discusses why the FranNet process is so wonderful to help small business hopefuls at finding the perfect franchise to buy. “I get just as many referrals from people who do not buy because they appreciate the fact that we help them find direction. I am not going to push someone to do something that’s not right for them.”

Being the coach

Gordon Dupries of San Francisco, CA elaborates on his role as coach in helping people realize their dreams. “From recent college graduates to boomers, I enjoy making a difference, teaching and mentoring people, in ways that can open up new career opportunities and income streams. I don’t know that it is always life changing, but it can be. When you’re in the thick of it, creating value for someone and coaching them through the self- employment question, covering their interests, experience, goals and potential pitfalls, it is extremely rewarding and a lot of fun.”

 
If you’d like to get in touch with one of FranNet’s locally-based consultants to discover if business ownership is for you, simply click on the directory and find the consultant in your area.

With mere days remaining before the 2012 presidential election, we thought it was important to take a look at what franchising means for the economy and jobs, one of the most talked about topics on the campaign trails.

Franchises are a very powerful part of small business across the country, and small business always plays a significant key in the election season. Especially given the slow recovery of our nation’s economy, it is small business that will ultimately turn the economy around. And the politicians know that.

One of the most significant issues that those looking to go into small business should keep their eyes on as the election draws near is the Affordable Care Act. The most damaging component of the act is the mandate that employers with 50 or more employees be required to provide health benefits to its employees. Employers that failed to do so would be punished with taxes and/or penalties. On the surface, it’s been billed as an opportunity for access to more affordable healthcare for all Americans. But digging into it, one can quickly see the damage it will do to small business in not truly accomplishing its goal.

First, it will discourage small businesses from expanding and growing their business beyond that 50 person threshold. Second, it will actually encourage small employers to potentially reduce their full-time payroll to 49 or less employees. Both of these are not sensible options in the interest of growing small business. Further, the costs associated with this act will simply be passed onto the American consumer, increasing the cost of goods down the line. We’ll all pay more at the grocery, at retail outlets, at food establishments – across the board, consumer good prices will go up.

The Affordable Care Act will have a significant impact specifically on the franchising industry, as many franchisees potentially seek to expand their business. It will cause a tough examination for business owners to determine if the benefits of growth outweigh the negatives of the additional burden of providing health care – or absorbing the penalties of not providing health care — to all its employees.

Election Officials Expect Large Turnouts

When it comes to the franchise industry as a whole, this election will have a significant impact. President Obama ushered in the Affordable Care Act, while Governor Romney has promised to attempt to repeal the Act. It’s FranNet’s hope that the election will provide the necessary boom to the economic outlook for America as we’re all seeking more jobs to be created. As the economy continues to rebound, many Americans still find themselves out of work. Many of them are looking into franchise ownership as a self-employment option. This year saw some very nice gains for the franchising industry as roughly 14,000 outlets were added across the country (adding approximately 140,000 new jobs). All early economic signs point to franchising setting itself up for a banner year in 2013. And a healthy, strong economy will only help that outlook.

Regardless of your party affiliation or stance, every American needs to make sure they exercise one of the most important rights we have – and that’s the right to vote. Make sure you get to your local polling location next Tuesday and let your voice be heard.

Mike Welch

Mike Welch is the FranNet consultant for the state of Minnesota, based in Maple Grove. Welch, 36, has found considerable success as a franchising consultant and in the franchising field in general, where he’s held three of the industry’s main jobs: franchise owner, developer and now consultant.

What’s your professional background?
I’m a bit of a broken ladder. I didn’t go to college, so I spent several years in my early 20s doing odd jobs, tending bar, laying carpet  and hanging drywall for a living. I had a young family then, a wife and a child, so I did what I needed to do to keep the lights on. I knew I needed to begin a career for my family’s sake, so when I saw an ad in the paper looking for salespeople to sell theater advertising across the country, I talked about it with Shari (his wife), and we agreed that I might be a good fit. As it turns out, we were right; I was really good at selling ads to small and medium-sized businesses. After a couple of years as a salesman and trainer, I became a national sales manager. In three years, I went from hanging drywall for $10 an hour to earning a very respectable income in sales and sales training.

How did you get into franchising?
Totally by accident. I was recruited by an indoor advertising firm that was also in franchising, and that’s when I fell in love with the idea of buying a business in a box. I knew most people wanted to own their own business, they just didn’t know how — and this company was selling the playbook! I loved the idea so much that I bought one of the franchises. I’m not a terrific strategist, but I’m an excellent tactician. If the strategy is sound, I am very comfortable with execution. I found that out through a lot of honest self-reflection.

After less than two years of owning this franchise, I sold it for an excellent return. After I sold the franchise, I was just going to take a sabbatical. But after a few days, I was going nuts. I had to do something, so I touched base with some people I knew, and within a month I ended up accepting a franchise development position with a very large franchisor. The position provided me access to resources that were previously unavailable to me, but yet I could work from home 95 percent of the time. It was a tremendous opportunity and a turning point in my career. It’s when I decided to go “all in” into the franchise industry.

Why FranNet?
FranNet was one of my lead sources; it was my best lead source. When the territory of Minnesota became available, I just jumped on it. I always wanted to be on this side of the fence. I’m an entrepreneur, and even though I was in a terrific spot with an excellent company, I was working for someone else, building someone else’s empire, so when the opportunity arose to get back into the driver’s seat, I just jumped at it.

What are some of the best franchise opportunities?
That’s the number one question I get, and it’s probably my least favorite question because it’s impossible to answer. I don’t know how to tell someone what’s the best franchise for them until I know them and really understand on a deep level what they are trying to accomplish.

Now, I will tell you that I’m bullish on anything that’s a necessity. Whether it’s a bull or bear market, people are going to get their hair cut. They’re going to get their transmissions repaired when they need to. Those are recession-resistant because you just can’t live without them. I also look carefully at anything related to demographics that have to be serviced — anything serving seniors, for example.

Have things in the franchise industry changed in recent years?
I think people are doing a bit more due diligence than they used to do, and they’re more cautious about what they spend their dollar on, which I think is excellent. It takes longer to get deals done because people are taking a closer look before they leap, which is fine with me. Buying a business is a marathon, not a sprint. Too many brokers worry about their paychecks, but to me getting paid is a side effect. The goal is to put people in front of the right concepts and help them through a fact-based due diligence process.

This business is totally karmic. You have to have the heart of a coach. I coach baseball and two football teams, and I’ve found that if you approach this business as a coach instead of a salesperson, you’ll win.

Are more people in your territory approaching you about franchising?
Absolutely. Our business is countercyclical. When corporate is displacing talent, that talent doesn’t just go away. Those people need to earn a living. I’m amazed at the talent pool that’s available in the Twin Cities right now. Our clients are some of the best and brightest that Minnesota has to offer. In most cases they come to us because they don’t want to go back to corporate. They are firing corporate America.

Do people still have preconceptions about franchising? How do you educate them about the diversity?
I ask for permission to challenge their paradigm. Most people still think franchising is only fast food and retail. So when people come to us, we have to break down that mental barrier. The first thing we do is have a bit of fun. We ask people, “What color is a yield sign?” Almost always, people say, “yellow and black,” but they’re not. They’re red and white. They haven’t been yellow and black since 1973. I said yellow the first time I was asked too, and I’ve never seen a yellow and black yield sign in my life. The point is that we have a tendency to disregard information that doesn’t pertain to a current need, so our perception of what is real may not always be accurate.  On your drive home from work every day, you pass thousands of restaurant franchises, so you think that’s what franchising is.

When a candidate comes to me, I say, “I’m going to introduce you to franchise opportunities you never dreamed of, and I need your permission to challenge your paradigm.” And they usually respond by saying, “Knock my socks off” because they came to us to see things from a different perspective. The socks then get knocked off. The goal is to find the opportunity that minimizes their exposure to their weaknesses and maximizes the utilization of their strengths. That’s what our evaluation process is for.

What advice would you give someone thinking about buying a franchise business?
Make sure you understand what the owner is responsible for and make sure it’s something you would enjoy doing for a long time. Forget what the business does. Focus on what the owner has to do. Your passion for blueberry glazed doughnuts is irrelevant. The question is, would you be happy and successful doing the things that are required to run a successful doughnut shop?

What kind of person makes a successful franchisee?
They’re entrepreneurial but not serial entrepreneurs. Mark Zuckerberg would be a terrible franchise owner. He would question everything, reinvent everything. Guys like Zuckerberg and Gates and Jobs, they accelerate matter and have it collide and create new things. That’s how their brains work. That’s not what franchising is. We’re entrepreneurial, but the person who makes a good franchisee tends to have a need for structure and support and is willing to follow a well-laid plan.

What are the benefits of franchise ownership?
The benefits of franchising are support, systems, processes, training and camaraderie. It’s hard for me to get lost at FranNet because I’m walking in the footsteps of those who’ve gone before me. But it’s not always easy. While the path through the woods has been cleared, I still have to do the walking.

Five helpful tips for franchisees to avoid the business-killing mistake

We’ve shown how franchise businesses fare better than typical small businesses.

It’s proven statistically and backed up by plain common sense — business owners who operate under a known brand and with an established business model have a big advantage over owners who have to start from scratch and figure out by themselves operations, marketing and point of sale systems.

Still, you shouldn’t assume franchises are fail-safe. They’re a wonderful way for professionals to build thriving small businesses, but there are some icebergs out there potential franchise owners need to avoid. Here are five:

Failure to absorb the FDD

It’s baffling to think that a franchisee would invest thousands of dollars in a business venture without knowing what he or she was getting into — especially when the law requires franchisors to disclose detailed information about operations, costs, earning potential and legal requirements.

But it happens. All the time. People get so excited about their business venture that they don’t read the Franchise Disclosure Document, or just read the Item 7 expenditures and Item 19 earnings information and skip over the rest. Then they’re caught by surprise later when it’s too late.

If you’re thinking about buying a franchise, you should review the FDD thoroughly and carefully, preferably with a good franchise attorney who can help you pinpoint problem areas or language that needs clarifying.

Underestimating what you need

It’s an easy trap to fall into — underestimating how much working capital you’ll need to make the business work. Small business loans are hard to come by these days. Unless you’re fully capitalized already, you’ll be cobbling the financing together from assorted sources, and it’s tempting to think you can scrape by on a minimum investment.

It’s a very risky way to go. If you hit a rough patch, you’ll need cash reserves to tide you over until you recover, and if the business account is empty, you run the risk of going under.

Failing to do due diligence

Before you even sign the franchise agreement, you need to go through the validation process, talking to franchise owners about the ground-level benefits and challenges of running the business.

Do it. Thoroughly. Do not assume talking to three top-performing franchisees is enough. You have to talk to the average franchisees, longtime franchisees, new franchisees, those doing well, those doing not so well. You should find out specifically why former franchisees left the system, whether it was a systematic problem or a matter of the kinds of errors detailed here.

Under budgeting your time

Franchise ownership is not a hobby. It takes commitment, especially in that critical first year. After years of success, many franchise owners can afford to work the business part-time and hire managers to take care of the day-to-day duties.

But it usually takes several years of success to get to that point, and until then, you simply have to put in the hours to get your franchise up and moving — and too many people go into franchising thinking they can get by on 6-hour days at first. It just doesn’t work that way.

Going your own way

There’s a paradox at the heart of franchising. The industry tends to attract aggressive, smart self-starters, take-charge types who never saw a business proposition they couldn’t improve.

These people can make horrible franchisees.

When you buy a franchise, you’re not buying a job, and you’re not bringing something to life from nothing. You buy an established name and system in a business you own, and the price for the advantage is the investment, franchise fee and royalties. That’s the deal. (Put another way: You didn’t build that. Not alone, anyway.)

But time after time, we see some franchise owners’ go-it-alone instincts get the better of them. Three or six or 12 months in, they get restless. This marketing plan is stupid. I can do it better. This sign doesn’t work in my market. My customers want a different message and more menu choices. The franchising graveyard is filled with businesses that failed because the franchise owner didn’t follow the system, presumably the reason why he approached the franchisor in the first place. The system’s there for a reason. Use it.

If you consult the franchise professionals at FranNet, you’ll hear a lot of the same advice, plus connections to some of the world’s top franchise brands, matched to you through a careful evaluation honed over 25 years. Want to know more? Look here for a franchise consultant near you.

Some good questions candidates should ask before they buy a franchise business

When entrepreneurs begin talking with franchise systems, they tend to ask pretty standard questions: How much money can I make? How much will I have to spend? How big can I get? Is the franchise territory exclusive? They’re sort of the first-floor questions, if you will.

But the higher you go in the building, the more pointed and detailed the questions get, and they’re critical for a franchisee candidate to ask before signing the franchise agreement. Here are five:

What does your first-year support look like?

Most good franchise systems, understanding how important the first year of franchise ownership is and how likely a new owner is to struggle, provide extra support and coaching. It could mean the home office assuming all responsibility for marketing, or using customer service reps in a call center to schedule jobs while the franchise owner concentrates on executing the baseline work.

There are all kinds of ways of offering support. But it’s important for any franchisee to know what kind of help he’ll be getting at a time when he’ll be needing it most.

What are the most common problem areas for franchise owners in your system, and how do you help solve them?

The test of a good franchise system isn’t how well it works with top performers. That’s easy. It’s how it helps franchise owners when they struggle. Even the smartest and hardest-working business owners in rock-solid systems run into challenges every now and then.

When that happens, the franchisor’s operations staff should be prepared to help the owner respond to the problem effectively. Experienced operations staffers have seen almost everything.

What kind of insurance should I have?

Don’t overlook this. It’s important to be protected in case of accident or natural disaster (this is especially true in food franchise systems), and you need to include the expense in your budget.

What kinds of ongoing training are available?

Smart franchise systems understand that their franchisees need to keep their skills honed, and franchisees in the system need to stay abreast of best practices — which, depending on the field, can change in days or weeks! Ongoing training opportunities are great for a secondary reason: They send the message that the franchisor cares enough about its franchise owners to give them the tools to succeed.

What’s the relationship among franchisees like?

A culture of cooperation among franchise owners can make the difference between success and failure, and good franchise systems go out of their way to foster good will. Incentives help: Franchisors can single out especially helpful veteran franchise owners in internal communications, or they can give monthly “helping hand” awards for the franchisee who most helped first-year owners.

Systems like these automatically pay themselves forward; as franchisees mature, they find they want to reach out to new franchise owners to help them the way they were helped when they started. That kind of culture can make a huge difference for the entire system.

FranNet is here to help as well. As a network of franchise consultants, we match entrepreneurs to some of the industry’s top franchisors through a careful evaluation process, developed over 25 years and based on candidates’ preferences, goals, budgets, passions and interests.

Want to know more? Download our free “Roadmap To Success” guide, then check our roster of consultants to find the one nearest you!

We’re excited that for the third consecutive year, FranNet has made Inc. magazine’s exclusive list of the nation’s fastest-growing privately held companies!

It’s great news for us. The annual ‘Inc. 5000’ list ranks companies on their three-year growth rates; ours was 49 percent from 2009-11.

Making the 5000 list follows two consecutive years on the ‘Inc. 500’ list, the top 10 percent of the 5000 list and one of the most prestigious registers in American business. In 2010, we registered nearly nine times our 2007 revenue, and in 2009 nearly eight times our 2006 revenue.

It’s incredibly rewarding to make Inc.’s list three years in a row. It’s an indication of how much demand there is for our services, even in an economy that still struggles. An astonishing number of former corporate workers have come to us for help in realizing their entrepreneurial dreams, and the numbers reflect the demand for our services.

FranNet is a franchise matchmaker that connects likely franchise owners with established national brands. Entrepreneurs who use us succeed at much higher rates than typical startups; our recent survey of more than 1,000 former FranNet clients revealed 85 percent were still in business after five years, compared to 50 percent for typical small businesses.

Like the franchise industry overall, which is projected to add 168,000 jobs to the U.S. economy this year, we’re doing very well. Now is an excellent time for professionals from any background to look at franchise ownership as a way to achieve financial stability and control over their careers.

If you’re stuck in a shaky, dead-end corporate job and have always thought about owning a business, franchising is a great option. Download our Road Map to Success on this site and set up a consultation with one of our consultants!

1. You will have to learn how to really “let go” and trust others.
Absentee businesses require employees. If you’re working at your job, who’s running the shop? There has to be at least a few trusted workers on site to operate the business, and it can be a challenge to find them. As a new business owner, you’ll learn quickly the importance of acquiring the face of your business – your employees.
2. “Location, location, location” will become your mantra.
In general, you can’t run an absentee business from your home office. You need to have a place where customers and clients go so they can purchase your product or service. As an absentee business owner, finding the right location to do business will be one of the most important aspects of your business.
3. You will come to understand the true meaning of multi-tasking.
The term “absentee business” sounds like you’d never had to be there, right? Well maybe not after the business is up and running. But at first, it may feel like you’re working two jobs for a little while. You will discover that this is a lot to bite off, but the plan is to get through that phase as soon as you can to a smoothly operating business that doesn’t require as much time and attention.
4. You will come to learn more than you ever wanted to about acquiring funding for your business.
By nature, absentee businesses cost more to set up and run. Employees and location contribute to the higher cost. However, in the case of absentee owner businesses, a working owner has a better opportunity to get funding when they need it than someone who isn’t working. A lender has more confidence in awarding funds when you are cash flowing on your personal side, even if your new business isn’t cash flowing yet. You’ll learn that a good relationship with a good lender can really help you when you’re building your business, and is one of the most important relationships to nurture and maintain during your time as a business owner.

If you are looking for ideas for a solid absentee business opportunity, your local FranNet consultant would be happy to explore this option with you.

Small bank approval rate has jumped 5 points, big bank rate 2 points

FranNet President and COO Jania Bailey

Since the near-collapse of the world economy four years ago, tight credit markets have stunted small business growth by shutting entrepreneurs off from startup capital. But they’re beginning to loosen.

The Biz2Credit Small Business Lending Index, a monthly analysis of 1,000 loan applications by International Franchise Association member Biz2Credit.com, found that loan approval rates from big banks jumped a half a percentage point from May (10.6 percent) to June (11.1 percent). The increase also represents a more than 2 percentage-point jump from June 2011, when the approval rate was a dismal 8.9 percent.

The loan approval rate from small banks rose as well, from 45.5 percent in May to 47.5 percent in June — a full five points higher than the 42.5 percent rate in May 2011.

This is great news, the latest piece of evidence that the economy is gradually improving and opening up more opportunities for entrepreneurs.
This year, we’ve already seen some of our clients finance their initial franchise investments through unsecured loans, something we hadn’t encountered since 2008, and leveraging their retirement funds tax-free to pay for their initial investments. It’s a smart move. “The more entrepreneurs have access to startup capital, the more jobs they create and the more local economies thrive,” says Jania Bailey, our president and COO.

Franchising is one of the few sectors of the national economy that has added jobs during the recession. The IFA predicts the industry will add 14,000 new units and contribute 168,000 new jobs to the U.S. economy this year, and each new franchise unit adds an estimated 10 new jobs to the economy. If credit markets continue to relax, those numbers may end up being too conservative.

FranNet, a network of 84 franchise consulting locations in the United States and Canada, has had amazing success in directing professionals to franchise opportunities that last. A recent survey of more than 1,000 franchise owners who used FranNet to find franchises shows that 91 percent were still in business after two years and 85 percent after five. Those rates far exceed those of typical small businesses (64 percent after two years, 50 percent after five).

Experience has shown us that usually, when entrepreneurs can secure startup capital to buy franchises, they succeed. Many people don’t know how diverse franchising has gotten and how many low-investment franchises don’t even require office space.

Now is a terrific time to explore franchise ownership as a sustainable career option. Interested? See our directory for the FranNet consultant nearest you.

Seniors may make up 25% of Canadian population by 2036, highlighting need for home health care franchises

Canada's elderly population is projected to reach 10 million by 2036. (Ayelie, Wikimedia Commons)

The Baby Boomer generation has reached retirement age, and the franchise industry throughout North America is rising to meet the challenge of a flood of seniors who live longer than ever and want to stay in their homes. Home health care franchises are a growing phenomenon in the United States — but they’re becoming incredibly popular and important north of the border as well.

In Canada, a nation with nearly 5 million seniors — a number expected to surpass 10 million within a generation — entrepreneurs are joining or founding franchise systems to care for the elderly and growing with surging demand. Such franchisors have grown extensively in recent years and expect to face even greater demand for their services over the next two decades.

Senior care franchises are a terrific choice for entrepreneurs who truly care for the elderly and want to seize a marvelous business opportunity, too. We’re directing more and more people in that direction, and we’re seeing more interest from professionals whose own parents have surpassed retirement age. “Personal experience can be a powerful driver for someone who wants to buy a senior care franchise,” says Gary Prenevost in our FranNet of Southern Ontario office near Toronto.

And there’s no ignoring the numbers: Canadian seniors’ share of the overall population has grown steadily in the last 40 years, from 8 percent in 1971 to 14 percent in 2010. But that year, the first of the Baby Boomers hit 65, touching off what demographers predict will be a sharp rise in the number and percentage of seniors until the last of the Boomers reach retirement age in 2031.

Gary Prenevost

By then, Statistics Canada predicts, the Canadian senior population could be as high as 11 million, accounting for as much as a quarter of the total population. The number of people 80 and older is expected to more than double to 3.3 million, and the population aged 100 or older could triple to more than 20,000, the agency projects.

Canadians, like most people in the developed world, are living longer; the average life expectancy for a Canadian newborn this year is 81 years, compared to 71 in 1960. Those factors, plus looming government deficits, have given rise to concerns that Canada’s taxpayer-funded universal health care system — the source of most of a record $200.5 billion in health care spending last year — won’t be able to sustain its service levels.

So there’s a distinct possibility of European-style austerity measures coming — and a reduction in public services that will send people running to private health care providers they can trust. When you look at the rising costs of nursing homes and the overwhelming preference of seniors to stay in their homes if they’re injured or ill, it’s apparent that senior home care franchises are poised to do very well for years to come, on either side of the national border.

Interested? Take a look at our directory for the nearest FranNet location.

Internet, diversity, FranNet-style franchise matchmaking has transformed the industry

In 1987, when Howard Bassuk founded FranNet in Carlsbad, Calif., this was how you let a franchisor know you wanted information about a franchise opportunity:

Modified Gordon Gekko: "Franchising, for lack of a better word, is good." (20th Century Fox)

You ran across the franchise in a magazine, at a trade show or while scarfing down a sandwich at one of their locations, if it was a food franchise. You filled out a form and sent it in. Then somebody in sales would call you and tell you more about the franchise system — which wasn’t hard, because at that stage in the process, you knew virtually nothing.

Well, the game of franchise consulting bears little resemblance to its Reagan Administration self (probably a good thing, since most of us were wearing acid-wash and trying to look like the guy from Whitesnake).

So, as your eyes grow misty with warm memories of Oliver North, Wall Street and Swatches (c’mon, you had ‘em, with the little neon face protectors and everything), we thought it’d be instructive to review the three big ways franchise consulting has changed in 25 years:

• More than French fries. In ‘87, fast food franchising was practically synonymous with franchising. Subway hadn’t even built itself out, having just launched two years before, and there was no sign of Panera Bread, Five Guys, Chipotle or any now-familiar fast casual eateries, much less today’s great service franchises. Diversity has flourished since then — franchising now includes 90 industries and more than 3,000 brands.
  

  Big hair. BIG hair. David Coverdale, Whitesnake, 1987. (RockBandAide.com)

• Matchmaking. Back then, franchise consultants were far less developed in their approach to matching entrepreneur with franchisor — if the buyer had enough money and seemed interested and competent, that was about it. But franchisors have learned the hard way that capitalization is just one part of the equation. Much smarter and more targeted approaches by franchisors have led to far better “fits,” and they’ve paid off: Franchise owners who use FranNet succeed at a 91 percent rate.
• The three Ws. The Internet has turned franchise consulting on its head as much as it’s transformed any other part of 21st-century life. In the pre-dot-com days, franchisors dangled scant details about themselves before prospective franchisees; if you told them the whole story up front, the thinking went, why would they need to talk to our salespeople? The Internet did away with all that. Entrepreneurs can find out all kinds of information about you and your system before you even hear from them, and it ultimately leads to more informed choices. Now, the franchise consultant’s role isn’t to load the candidate with information; it’s to pare it down to the best opportunities.

That’s what FranNet does every day through an evaluation process we’ve fine-tuned over our 25 years and are still developing as we roll with a rapidly evolving industry. It’s thrilling, and we can’t wait to see what franchising will look like in 2037!

Want to find the FranNet consultant near you? Take a look at our directory.

Senior care and tutoring franchises are booming, says FranNet franchise consultant

Jim Gleason, 62, worked in sales, alcohol and drug counseling and career consulting before joining FranNet five years ago. The Indianapolis-based business covers almost the entire state of Indiana, save the Gary area near Chicago and the area just across the Ohio River from Louisville, home to our headquarters. A chance encounter with an old college buddy led him to franchise consulting.

Jim Gleason

How long have you been a FranNet consultant? What’s your professional background?
I joined FranNet about five years ago after a pretty varied career. I spent a number of years in sales for Burroughs, which used to be one of the biggest names in computing; I was selling computers in the early ‘70s, when most people didn’t even know what a computer was. I worked for a while as a stockbroker, then 17 years in alcohol and drug counseling … then I spent several years in career consulting, but I was still looking for a better opportunity.

How did you get into franchising? Why FranNet?
I was doing some executive coaching, and I saw (FranNet of MidAmerica owner) Thom Crimans coming out of a Chamber event here in Indianapolis — we were frat brothers at IU, and I hadn’t seen him in a couple of years. So he started telling me about FranNet and asking me if I knew anybody who might be a good fit for franchising in my area. He gave me some documents, said, “Hey, here’s list of what we’re looking for.” So I told him I’d keep an eye out. A couple of weeks later, I took a look at the stuff he’d given me — “Have you done outplacement work?” Yes. “Have you done coaching?” Yes. I called Thom up and said, “Hey, maybe we should talk.” I don’t believe in coincidence. God puts you where he wants you to be.

What are some of the best franchise opportunities in your territory, and have those changed in recent years?
We consistently see a lot of opportunities related to senior care, with the Baby Boomer statistics showing that 7,000 to 10,000 people every day are turning 65, and there’s a huge and growing population that’s going to need those services. I know, because I went through having to take care of my mother. We’ve placed a couple of people in commercial sign businesses; one client of mine is so busy, she can’t keep up with it. I think there’s a lot of opportunity in tutoring because of what’s going on in our public school systems, which are not really preparing kids for college, so parents are looking for other ways to educate their kids. That’s something I think will really pick up in the years to come.

Do people still have preconceptions about franchising?
Whenever I go talk to a group, I always ask, “What industry do you think of?” They always say McDonald’s or Subway, retail and fast food, and that’s simple because that’s what they see on the side of the road every day. They also think you’ve got to have a lot of money and a building, and that costs are prohibitive. Our job is to educate people about the diversity and affordability of franchise opportunities out there. There are all kinds of franchises that have nothing to do with fast food.

Thom Crimans

How do you educate them about the diversity?
Through seminars or by meeting people one-on-one. Last week was a good example. I had a half-hour meeting through a company called Business Professional Exchange with people who had been downsized, and most of them had the same preconceptions about franchising. I try to help people understand there are 90 different industries and 3,000 franchises, and there’s a lot more opportunity out there than people think.

What advice would you give someone thinking about buying a franchise business?
The most important thing for anybody is to understand themselves and their motivations. I see people who think because it’s a franchise and has systems in place, it’s going to be easy, but it’s still a startup business. Certainly, you have a better chance of success than you would with a regular startup — we have the statistics to prove it — but you still have to work really hard at it, and if the motivation isn’t there, you shouldn’t do it.

What kind of person makes a successful franchisee?
We see people who have all different kinds of backgrounds. I see people who have owned small businesses, people from corporate backgrounds, young people, retired people. You just need to be somebody who’s really motivated to go out there and do what you need to do. Franchisees  learn during validation what they need to do to be successful. That’s a great thing about franchising: You can talk to people today about what you need to be doing tomorrow. To succeed, you need to have drive and motivation, good systems, and you need to be a good fit for the franchisor. We help with the systems and the fit, but the drive and motivation are up to them.

What are the benefits of franchise ownership?
You really mitigate your risks in franchising. By educating yourself, you make sure you’re a good fit for franchising. Then we fit a person to a business based on their motivations, experience, goals and values. Then by doing research, validation, due diligence, they learn how people succeed and fail, and once they get into it, they have systems in place, plus support from other franchisees and the franchisor. Those four things together, I think, greatly mitigate the risk.

To find a FranNet consultant in your area, see our directory.

FranNet President and COO Jania Bailey

FranNet loves our nation’s veterans and wants to help them build careers that match their talents and character. Franchising is, in many ways, a perfect fit. Franchise businesses thrive with owners who are driven, passionate, self-starting and motivated — yet do well within a team environment and with detailed systems. Military service cultivates the same traits.

Next week, some of our folks will head to Detroit for an important event designed to put as many as 6,000 of our veterans in touch with great career opportunities. It’s the U.S. Department of Veterans Affairs’ Veteran Hiring Fair and Open House, to be held June 26-28 at the Cobo Center.

We’ll have a booth there, along with hundreds of companies and franchise systems, and our goal is to enlighten veterans about how good a fit franchising can be for them. Few people realize that one of every seven U.S. franchises is veteran-owned, and the growing diversity and volume of franchise opportunities — and the sheer number of veterans returning from combat in Iraq and Afghanistan — means that percentage is likely to rise.

We want to do everything we can to steer these brave men and women to great opportunities in franchising, where they can build on the skills and character they developed during their service to create successful businesses.

And these folks need some help. Veterans on active duty after the war in Afghanistan began in September 2001 — Gulf War-era II veterans, as the U.S. Bureau of Labor Statistics calls them — have had a hard time finding work. In 2011, the unemployment rate among these recent veterans was 12.1 percent, compared to 8.3 percent for all veterans and 8.5 percent nationwide.

It’s not an acceptable situation. So, thankfully, people are taking action. This year, President Obama included tax credits, tax cuts and other measures for veterans and businesses willing to hire them in the American Jobs Act, which Congress passed and the president signed in April.

The franchising industry has aggressively helped returning veterans in recent years; the International Franchise Association’s VetFran program offers support, information and franchise fee discounts, and the IFA’s “Operation Enduring Opportunity” is targeting 75,000 veterans and 5,000 “Wounded Warriors” as franchise owners by 2014. FranNet proudly supports VetFran and the Wounded Warrior Project, a nonprofit that provides programs and services to veterans who have sustained severe injuries during combat.

So many of our nation’s finest are struggling to find work, and it doesn’t have to be that way. Please support us as we head to Detroit, and if you’re a franchise owner or prospective one, take a good, long look at people with military experience. They deserve more than just a handshake and thanks for their service — they deserve real opportunities to build solid foundations for their careers and lives.

For more information about us, see www.frannet.com.

• Diversification. Franchising used to mean two things, mainly: restaurants and hotels. Those two areas are still thriving, to be sure, but one of the most interesting developments in franchising in the last decade has been the rise of low-cost, service-oriented franchises specializing in such lucrative areas as auto detailing, home maintenance and especially home health care. That last category is especially popular with the “silver tsunami” of the Baby Boomers reaching retirement age.
• Freedom from the corporate grind. We’ve seen thousands of people disillusioned by the arbitrariness and lack of security of their corporate jobs — not to mention the threat of their pensions and retirement funds withering on the vine — turn to franchise ownership as a way to secure employment, build equity and regain control over their careers.
• Franchising gives you the manual. Most small businesses fail in their first year of operation, when the owner is desperately trying to build a customer base and figure out just how this business works. By the time he realizes, he’s often drowning in red ink. Franchisors provide owners with detailed, proven systems and marketing materials at the front end, eliminating the learning curve that can derail potentially successful entrepreneurs.
• It works! Look at the survey — of the people who have used FranNet at the front end of their franchise-buying process, 91 percent are still in business after two years and 85 percent after five. That’s an amazing success rate, especially compared to the available stats about startups: 64 percent success rate after two years, 50 percent after five. It’s hard to argue with those numbers.

At FranNet, we’ve helped thousands over 25 years realize their dreams of business ownership through franchising with our own system of evaluation and network of great franchisors. Want to explore these great opportunities? Visit us at www.frannet.com.

meta title: Business Franchises Have a Good Friend in FranNet
meta description: The network of consultants for business franchises helps small businesses succeed at a rate 42 percent higher than non-franchised startups.

• Houston: “Entrepreneurs benefit from low living costs, no state personal income tax and a franchise tax capped at 0.575% for businesses with less than $10 million in annual revenue.”  The report further cited “high-powered incubators such as the Houston Tech Center, the Rice Alliance and Capital Factory funnel money and mentorship to promising start-ups.”
• Indianapolis: “Cheap housing and office space, a low cost of living, and an excess of young talent from half a dozen universities feed the city’s start-up community.” The report further cited “nearly a dozen start-up incubators and a laundry list of venture capitalists, including big-time angel investors like Gravity Ventures and Halo Capital.”
• Minneapolis: “More than 70 companies launch in Minneapolis every week — a result, perhaps, of the city’s low business taxes, multiple incentive and mentorship programs, and highly educated workforce.” The report further notes the city “saw its first coworking space open in July, and a year-old tech accelerator called Project Skyway has already funded more than a dozen startups in the region.”
• Oklahoma City: “Oklahoma City entrepreneurs have two big advantages over business owners elsewhere: Midwestern startup costs are low, and government support for business is strong.” The report further says, “Oklahoma City has also partnered with i2E, an incubation nonprofit, to launch an entrepreneurial development center; investors contributed some $35 million to i2E companies in 2011.”
• Raleigh, N.C.: “Raleigh recently announced a city-sponsored summit for entrepreneurs, as well as an ‘innovation and entrepreneurial center’ for use by start-ups.” The report further cited Raleigh’s “four incubators and one of the Southeast’s largest venture-capital firms.”
• St. Louis: “St. Louis is a small pond compared with other places on our list, but the city gives local start-ups enough tax breaks and incentive programs to make it big,” the report says. “Government agencies such as the St. Louis Development Corporation supply low-interest loans to small businesses and subsidize co-working spaces.”
• San Francisco: “San Francisco attracts entrepreneurs for two reasons: unrivaled access to venture capital and a legion of creative, like-minded people.” The report further cites San Francisco’s “dozens of start-up incubators, which provide office space, mentoring and seed capital to everyone from Internet tycoons to fashion designers to aspiring food-truck owners.”
• Seattle: “Seattle is better known for major tech operations than for scrappy, small-time start-ups. But the city’s tech monoliths provide big opportunities for entrepreneurs.” The report further cites Seattle’s “own branch of TechStars, the nationally prominent and highly moneyed accelerator, as well as eight coworking spaces and near-daily networking events.”
• Tampa: “Tampa promises more than nice beaches and a low cost of living. The Gulf Coast hot spot is also home to a nascent start-up scene. Local government is particularly business-friendly, promising tax credits to businesses that locate in certain areas or work in one of a number of high-demand industries.” The report further cited Tampa as “a key player in the Startup America Partnership, a national initiative that has funneled more than $730 million to new businesses in Florida and six other states.”
• Washington, D.C.: “Job seekers often associate the District with government work, but the capital’s educated workforce and deep-pocketed investors make it an attractive option for entrepreneurs as well.” The report further cited “a $450 million fund to support new D.C.-based businesses” by AOL founders in late 2011.

If you’re in one of these cities and think you want to join the thousands who have used us with great success to find professional fulfillment through franchise ownership, find your local FranNet consultant at www.frannet.com/directory!

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