Franchise. An alternative for your next career.
A close friend is considering ditching her job to become a business owner. She’s played the corporate game for a few decades, and now wants more control over her professional destiny.
Starting a business can be risky. According to a Washington Post report, fifty percent will fail within five years. Yet there is a strategy that can bump the success rate up to a more comfortable level, and that’s by going the franchise route, rather than starting from scratch.
According to alternative career coach Steve Miller with The Entrepreneur’s Source, 80% of franchises will still be thriving at the five year mark. The difference? Franchises work within a proven business model of documented processes, provide implementation training and support, come with an established brand and marketing strategy, and offer access to a network of other owners for best-practices collaboration.
Miller says that like my friend, people who are frustrated in their careers, or those who have retired and want to stay active while building equity, are good candidates. A latent entrepreneurial streak is also helpful.
But different from what you might expect, franchisees don’t need to have skill in the business they may choose. Miller explained that it’s better if they don’t, allowing them to focus more on running the business rather than executing the product or service. The result: you might end up owning a plumbing company and never touch a wrench.
However, a franchise can cost hundreds of thousands of dollars to purchase. Many, though, can be financed through a Small Business Administration loan, or by accessing retirement funds with no penalty or taxes. At the least, a credit score of 680 or higher and $15k liquid to invest can buy entry to a range of business types, from office space to handyman services.
And when you’re ready to step out, they offer resale value, providing both cash flow as an owner, and a nice nest egg upon retirement.
Turns out my friend is considering purchasing a franchise, and I’m excited for her. Speaking from experience, business ownership has challenges, but the rewards can make it worth it.