“Start a business in this economy? Are you crazy?” Maybe not so crazy. For the moment, set aside the fact traditional employment options might be limited because of this economy. (It isn’t a news flash the job market is tight.) Instead, let’s focus on different questions: Is a business started today likely to succeed or to fail? Are there good recession resistant businesses? It all depends on the kind of business. This might not be a great time to start a business selling luxury goods. But aren’t there other options? What about businesses selling necessities? Better yet, what about businesses selling necessities at a good value? Maybe this is a great time for that kind of recession resistant business. Tutoring services, for example, are famously steady in an off economy. No matter how tight money might be, many parents will make it a priority to see their children have the resources needed to succeed in school. What about businesses that operate almost independent of the economy? Yes, there are some. Have you ever had the misfortune of having a flood in your home? A problem like that happens just as often in economic booms as it does in a recession. There are businesses that provide exactly that kind of disaster repair. It’s hard to think of a reason a disaster repair business can’t do well in a recession. What else? What about businesses with greater demand in a down economy? There are plenty of business owners struggling today. Wouldn’t this be a great time to sell services that can help turn around someone else’s struggling company? Not to mention anyone who sells a product that will help a business to lower its costs. Wouldn’t this economy help that sort of business to prosper? There are certain demographics that are growing quickly. It might be a great time to own a business that sells to the fast growing population of senior citizens. There are several types of businesses that sell to seniors. Some might provide skilled medical care, and others non-medical care. Still other businesses provide home modification services, installing wheel chair ramps, stair lifts, or shower adaptations. If you are providing this type of service, you might do very well in a world with a fast growing population of seniors. Corporate America has cut so many positions they have created an excellent opportunity for temporary staffing companies. Many retail businesses continue to do well – sales are way up at dollar stores. And, given more people than ever work from home, pack-and-ship stores are doing more business than ever. We could go on and on. Yes, this economy has hurt a lot of businesses. But it has also created opportunities for many others. There truly are some great recession resistant businesses. This might, indeed, be a great time to start a business. You just have to find one that has the right kind of market.
You’ve heard a lot about franchises. Maybe you’ve wondered, “People seem to make a lot of money with franchises. Should I do that?” The answer might not be an automatic yes. There are a lot of factors that go into providing an answer. First, you’ll need an honest assessment. Just to determine if you should consider any franchise, you should be able to answer “yes” to these questions:
"What is the best franchise to buy?" This is the most common question I’m asked; followed closely by “What is the hottest franchise?” Or, “What franchise should I buy?” That would be a great question – if it wasn't the wrong question. The simple truth is, there is no such thing as a “best franchise.” But there might be a franchise that is best for you. Just as each person is different, so is each franchise. The franchise that is a perfect fit for Joe might be completely wrong for Jane. Because, most likely, Joe and Jane are different from each other. There are many franchises where the primary role of the owner is to manage key employees. McDonald's comes to mind. Some of the key tasks for the McDonald's owner are to hire and manage the store managers. To be successful, the owner must be willing to work closely with a few key managers, to train, and develop them. It’s also helpful if this owner is good at watching the many, many details that have a big impact on a McDonald's, such as inventory levels or wastage. But not every franchise is like that. Some have very few employees, and maybe no inventory. You might never have heard of 101 Mobility, but it’s a leading edge company in the field of home modifications such as stair lifts or wheel chair ramps for people who have become disabled. This franchise requires only a handful of employees. The owner’s role is to develop relationships with key referral sources, and to ensure proper delivery and installation of the needs modifications. These are both excellent franchises. But the person who would make a great McDonald's franchisee has very different skills from the person who would be successful owning 101 Mobility. There are other considerations, too. Don’t only think about what your skills are, but also what you like to do. I recently worked with a man, Mario, who had spent 25 years selling restaurant equipment and managing restaurant equipment salespeople. If I never asked him about his preferences, he would have looked only at franchises where the owner’s role would be to sell. But as I questioned him, this man explained he had grown tired of selling. He had done enough of that. He was ready for a new challenge. In the business he eventually started, Mario was not at all involved with sales. Because he was able to enthusiastically tackle his new, non-sales, responsibilities, Mario has built a large, successful work-place drug testing business. What other criteria should you consider for a franchise? We suggest our clients think about: What kind of a work schedule do you want? Business hours only? Or are you happy to work nights and weekends? Your investment budget is an important factor. How much do you want to invest? Think hard on this one – you don’t want to lie awake at night regretting too large of an investment. Are you comfortable delegating to others? Not everyone is. There are many factors to consider in deciding what franchise might be right for you. Do your research, give close thought, and don’t be impulsive. There is no such thing as a “best franchise.” But if you do your homework, you just might find the best franchise for you.
Sure, there might be some great franchises out there. And there might be some low-cost franchises. But everyone knows if you want to make real money you need to invest a lot. Right? Wrong. There is no direct relationship between the amount you invest in a franchise and the amount you can expect to earn. That’s right. Though it comes as a surprise to most people, the amount you might earn with a franchise has nothing to do with how much you need to invest. There really are some great low-cost franchises. There are a few reasons for this. The biggest reason is the amount of the investment is largely a function of the kind of industry you are in. It’s been widely reported a McDonald's costs over a million dollars to open. If you think about it for a minute, that makes sense. To open a McDonald's, the owner usually builds a building. You’re already out of the “low investment” arena, but you aren’t done. You’d still need to pave a parking lot, put in a drive-through lane, and put up that big golden arches sign. All of that is expensive, sure. But we haven’t even talked about the inside of the building – tables, chairs, cash registers, freezers, grills, and on and on. It’s all those asset costs that drive the investment. That’s what makes restaurants one of the most expensive categories of franchises. You can say the same thing about any type of retail operation. You usually have to rent expensive space. You have to build out the space – carpet and shelves and lighting and signs – it all adds up. But now consider the other end of the spectrum – the low-cost franchises. What about businesses that don’t require expensive real estate? What about businesses that don’t need parking lots and inventory and signs? There are plenty of franchises that are service businesses. The owner works out of their home, or maybe out of a small, inexpensive office. Without the need to build and equip a large restaurant or retail space, the investment is much, much lower. How much? Many top opportunities have a total, all-in investment of under $150,000. Sometimes much under. Senior care is a great example. This is a business, just based on demographics, is projected to grow steadily far into the future. It is a rewarding, recession resistant business. It has a very high income potential. Many franchisees earn a net income of $300,000 or more! The opportunity is high, but the investment is low. What are some other low-cost franchises? There are tutoring businesses and coaching businesses and painting businesses and direct mail business, and many others – all of which have investments not much more than $100,000. And many, many of these franchisees earn large, six figure incomes. If you’re interested in exploring franchises focus on finding a business that you like. Don’t worry about how you’ll raise a million dollars. Chances are, you won’t need that much.
Ever Thought About Being Your Own Boss?For those of you who want financial freedom and are frustrated by the discriminatory practices of corporate America, the solution could lie in business ownership. I’m not talking about starting your own business from scratch, I’m talking about buying an established business of franchise as a way to break free from working for someone else and establishing your own path to wealth. Are you a seasoned professional (50+ years old) and looking for work? Did you spend years building your career only to now find yourself without a job and feeling like corporate America doesn’t want you anymore? You aren’t alone. I speak to people every day that feel the way you do. They are talented, smart, and eager to engage in meaningful work. But, they can’t seem to land a job, or even find one that seems like the right fit for their skills and experience at this stage in their lives. If that sounds like you, then watch my seminar on the alternative to job searching in these troubling times. In this FREE webinar I explain:
- What 70% of all millionaires share in common.
- Why you need to stop looking for a job.
- Why you need to start looking for a problem to solve.
- How to invest in the one thing you can count on – yourself.
Are you a seasoned professional (50+ years old) and looking for work? Did you spend years building your career only to now find yourself without a job and feeling like corporate America doesn’t want you anymore? You aren’t alone. I speak to people every day that feel the way you do. They are talented, smart, and eager to engage in meaningful work. But, they can’t seem to land a job, or even find one that seems like the right fit for their skills and experience at this stage in their lives. If that sounds like you, then watch my seminar on the alternative to job searching in these troubling times. In this FREE webinar I explain: