In addition to reviewing the economic environment facing small businesses, the latest edition of The Small Business Economy, produced by the Office of Advocacy, presents new research on training for small business employees and owners (see Chapter 5).
Small businesses play an important role in training the country’s workforce. As well as being primary job generators, small businesses are major trainers of U.S. employees.
About two-thirds of workers get their first job in small firms; thus small firms train much of the workforce. The training offered in small firms tends to be more general, informal, and flexible than that provided by large firms.
Training is a particularly important topic at this time. The recession, high unemployment rate, and decline in self-employment have important implications for how small businesses train and retrain the workforce and whether entrepreneurs can start businesses and create jobs. Small business workers as well as owners need training to improve, maintain, and update skills especially when technology changes rapidly. The recently enacted stimulus package includes $4.5 billion in additional monies for job training.
Census data from the 2004 Survey of Income and Program Participation (the latest available) provide updated findings about formal training. They indicate that:
- Small firm employees are much less likely than those in large firms to receive formal training. (The chapter defines “small” as having fewer than 100 employees.)
- Formal, employer-provided training has declined since the mid- 1990s.
- Women employees are more likely than men to receive training.
- In small firms, workers with union status are more likely than non-union workers to receive training; in large firms the opposite is true.
- Most formal employee training takes place on the job, but workers in small firms are more likely to receive off-site training than large firm workers.
- Small firm workers are more likely than large firm workers to pay for off-site training or to have family members foot the cost.
- Almost 15 percent of all business owners received training during the previous year to improve their skills.
For more information, refer to Chapter 5 of The Small Business Economy at www.sba.gov/advo/research/sb_econ2008.pdf.
by Jules Lichtenstein, Senior Economist, SBA Office of Advocacy
In previous posts we covered: Safety, Affordability, Success and Fitting Your Image. Now we end with #5, PRESTIGE!
For some people this is a big category and for others it is not. Some people could care less about what other people think about them and others it is a big factor. Others are easily influenced by what others think. This is what we call peer affirmation. People seeking affirmation from their peers will talk to anyone about what they are thinking about and planning to do. If the others agree and go along with it, then they will keep moving forward. If not, then that business is most likely going to the wayside.
There are definitely some very “sexy”, “white-collar” franchises out there. We are always on the hunt for them, since they can be very affordable and can do quite well for the right people. However, they sell very quickly.
Some franchises do not look very prestigious from the outside. After investigating them and seeing the growth opportunities that can exist, they can become very prestigious.
Almost all clients who come to FranNet are thinking that they know the business that they want to buy. They will most always end up buying something totally different and one that they never even knew was out there. It still needs to meet their prestige factor though, whether the factor exists for them or not.
So, safety, affordability, success, fitting your image, and prestige are the top 5 buying factors of buying a franchise. All of them must be answered to your satisfaction to say yes to that business. Jot them down on a piece of paper and weigh them against the franchise(s) that you are researching. If you can come up with answers to all of them, you are most likely making a well-informed and educated decision.
Now that you are experts, go out there and do your research. More importantly go after your dream!
This is a continuation of the Top 5 Buying Factors when Buying a Franchise and today we will cover: SUCCESS and FITTING YOUR IMAGE.
Most people get into franchising to be successful. They usually have a dream and are trying to fulfill that dream. Success is in the eyes of the beholder and it means different thing to different people.
In fact, according to the U.S. Department of Commerce, 95% of franchises are still in business after five years. Compare that to less than half of traditional start-ups are reportedly still in business five years later. Due to the high satisfaction ratings, it is not surprising that nearly two-thirds (65 percent) of the franchise owners said they would purchase the same franchise again.
As you can see, most feel that they are successful but you have to determine what success means to you. Your next step is determine the franchisees in the franchise that you are researching are achieving the goals that you would set for yourself and living the lifestyle that you would like to lead. If you find that only the top franchisees are successful in your mind, then take the advice of putting the franchise to the side and start looking at others. Chances are you are not going to be the top franchisee in that system. I certainly hope you are, but it is better to be conservative and play it safe.
Remember, define success and make sure the franchisees are achieving the success that you have defined for yourself.
FITTING YOUR IMAGE – Is the franchise you are researching fit your image and will you feel good about what you will be doing?
Sometimes you need to slow down and ask yourself, will you be happy with the franchise? Only you can answer this question. If you are not sure about something, then make a list of questions and concerns and do some more research. If you come to the same conclusion that is not what you are looking for then move on to another franchise. You definitely need to be happy with yourself and the franchise that you are considering, otherwise just the opposite will most likely happen. You will be doing things you do not want to do and therefore you will not do them and the business will suffer.
Do yourself a favor and ask yourself if you will be happy and do you have a good self-image of yourself in that franchise.
This is a third part of the Top 5 Buying Factors when Buying a Franchise and today we will cover: AFFORDABILITY.
Having affordability listed as the second most import factor usually surprises people. Unfortunately, some people feel safe about the decision that they are making, but sadly they end up not being able to afford it. This is where your CPA comes in very handy. We usually use the typical rule of thumb that you should have 1/3 in liquid capital of the total amount of the franchise. You should also have some extra reserves just in case.
Here is an example. The average franchise according to the International Franchise Association costs approximately $150,000. Therefore the average person should have about $50,000 in liquid assets that they are willing to invest. Most people can get the financing for the remaining two-thirds from a SBA approved bank or other financing sources. There are many services available to roll over money from 401k’s and IRA’s to help with the expenses.
The number one reason that franchisees and business owners go out of business is lack of funds. Whether it is a Fortune 500 company or a brand new business, if you cannot pay your bills, then you are done. Do not over extend yourself financially. It is unfair to you and your family. If you take the rule of thumb into account above, you should be all right. But please, consult with your CPA or financial advisor so you can make an educated decision.
The other nice thing about purchasing a franchise is that there is no correlation between the cost of the franchise and how much you can make. Franchises range from approximately $20,000 to over $3 million. The ones that have the large price tags, have large price tags because they have a lot of build out expenses, needed working capital, equipment, etc. Just because they have the large upfront fees, does not mean that it is going to be more successful compared to one that does not. Some of the most successful franchises that I know of are in the $75,000 range or less.
Remember, do not overextend yourself financially and you do not have to spend a lot to make a lot.
This is a continuation of the Top 5 Buying Factors when Buying a Franchise and today we will cover: SAFETY.
Safety is the number one buying factor in anything and everything you purchase and is especially true in buying a franchise. Buying a franchise is a very serious decision and sometimes a life changing one. You need to feel safe about the decision that you are making, otherwise you should not and will not do it. How do you answer the question of feeling safe about the decision that you are making you ask? Simple, research, research, research.
Research is the key to safety. You need to use all the help you can find to help you with your decision. Many people use a free service such as FranNet to help them out but you should also consider using a franchise attorney and also an accountant. More importantly, you need to do a lot of the research yourself.
Another important step to safety is talking to those who recently purchased in the franchise (known as franchisees) that you are considering. Since they were recently in your situation and now run a franchise, they will tell you exactly what the process is like. Now, some will be more willing to talk to you than others, but usually they will sit down with you and answer most if not all of your questions. They were once in your shoes and they did their research at one time as well, if they did it right. You also need to talk to the franchisees that are doing very well and some that are not doing so well. We usually also find it helpful if you also talk to some franchisees that come from a similar background and demographics that you have. If they are succeeding, then you have a good chance as well, but if they are not, then stay away from that particular franchise. While not everything is a given, it will certainly help out in your decision process. You need to talk to as many franchisees as necessary for you to feel that you have answered all your questions and concerns. Keep in mind, the answer to safety is in the research.
A question I hear often is, “If you were in my shoes, what franchise would you buy, or what is the hottest franchise right now?” I repeatedly come back to them with the statement that it does not matter what I think, it matters what you think, since you are the one that will be signing the franchise agreement and ultimately affected by the outcome of the business. Therefore, it only matters what you think. Here are the buying factors that you should think about when buying a franchise:
4. Fitting Your Image
Those are the 5 buying factors of purchasing a franchise or any business of any kind. The secret is, every one of them must be met and answered in your satisfaction in order for to select the right franchise or business. I’ll be discussing each one over several posts to cover all five.
The art of networking involves much detail and skill in introducing oneself. It is beneficial to make a good first impression and build initial trust with your business counterparts. Good verbal communication and positive body language are all essential when mingling with others. Another way to impress your colleagues is to have good manners and display the properly etiquette style. This type of behavior increases your professionalism, shows sincerity and implies that you are serious in your networking endeavors. A perfect example of this, would be introducing friends and colleagues properly at events.
Listed below are helpful tips on how power networkers extend a kind greeting and broaden their sphere of influence.
Consult the Game Book
Before you hit the networking scene it is important to know the rules of the game. In order to play fairly and score points, individuals must be aware of how they interact and treat others. Focus on the proper ways of introducing yourself and guests at an event. The process should be smooth, natural and effortless. It is recommend that networkers brush up on their etiquette skills by reading resources online, magazines or books. As you are reading and researching, make sure that these particular questions are being answered:
· Who do I introduce first?
· How do I make a proper social or business introduction?
· What are good ways of describing my relationship with my guest to others?
· How can I make my guest feel comfortable as I am introducing them?
· What are ways to comfortably include my guest into my conversations or dialogues?
· How should I connect my guest with my colleagues and friends?
· How can I encourage my business counterpart(s) to follow up with my guest?
· What may I suggest to my business counterpart, so they may invite my guest into their network?
By Chi Chi Okezie – Chi Chi Okezie is owner/producer of SIMPLEnetworking, LLC in Metro-Atlanta, GA. Newly published author of “SIMPLEnetworking: Creating Opportunities … The new form of success!” View excerpts of the book and polish your professional approach: http://www.snseminars.com
Article Source: http://EzineArticles.com/?expert=Chi_Chi_Okezie
Here are a few tips to keep in mind the next time you add members to your team.
No cloning! – It may be true that you are the best employee so don’t expect a new hire to be exactly like you. Everyone has their own style and habits of getting worked completed. Make sure the new hire enhances your team. Hire people that compliment your work ethic and habits.
Set expectations! – Before you interview, make a list of your needs for this open position and what tasks you want this position to accomplish. Take the time to write down your expectations so you can clearly state them during an interview. This will help you in the long run to hire the right person and build a solid foundation. Many misunderstandings and frustrations occur simply because a new hire didn’t understand the expectations of the boss.
Just the facts please! – Create a Fact Sheet for interested candidates that you can provide along with an application. This sheet should cover a brief history of the company, a basic job description, expectations and the hiring process.
What’s your style? – What type of managing style do you have? If you like to check in a lot then you may not want to hire a person who works independently this could appear as micro-managing and frustrate the new hire. Or if you like to have a hands-off approach then hiring someone who needs a lot of feedback will feel isolated and not feel a part of the team. Determine your style and hire those that work well with your style.
Hiring Process! – This cycle of finding the right person varies. Don’t settle on just having a warm body to fill the position! Make sure to set a realistic deadline, plan to advertise, interview and even train until you find the right person for the opening.
By following these helpful tips, you are well on your way to a happy and productive working relationship with all your new help!
To learn more about opportunities with FranNet call 1-800-FRANNET or visit www.frannet.com.