The annual International Franchise Association (IFA) Convention recently concluded in Phoenix, Arizona. The city, the venue and the attendees were different than they were in years past, but the outlook for the franchising world remains the same.
It’s going to be another very good year.
As a franchise consultant, I get this question regularly from candidates trying to decide if they should explore entrepreneurship through franchising or try opening an independent business. Traditionally, franchises have been considered safer bets than startups because franchise businesses offer unmatched levels of support along with proven business models of success.
However, do a search of success rates for franchise business vs. independent startups and you’ll get a wide range of answers, none of which can be considered conclusive. However, a recent study posted on entrepreneur.com revealing why small businesses generally fail confirms what I’ve believed all along:
Take a good look at your life right now. Odds are, it’s going to look very different in a decade. Change will come for everyone, but preparing for change is what separates those who create the life they want and those who exist in whatever life creates for them.
Which person will you be?
Beauty is booming and more than ever, the franchise industry is catching on with terrific new concepts. The Health & Wellness category annually generates $60 billion in revenue, offers many concepts in the low-cost service industry and generates lots of repeat business.
Visit enough franchise consultant websites and you’ll see plenty of language explaining that our services are free. No risk, no obligation…just pick up the phone!
That’s true, but that doesn’t mean that candidates don’t make an investment when working with a franchise consultant. It just means that investment isn’t a financial one.
How do you know you’re ready to be your own boss?
The message isn’t going to come from your friends. It’s not going to come from a spouse, a parent or a sibling. It’s not going to come from a co-worker, a motivational speaker, or a business consultant.
The only person that will know is you. You just need to listen to your own thoughts.
When most people think about retirement, they picture a life of leisure, complete with long walks on the beach, mornings on the golf course, long lunches and afternoon naps. Mix in some time with the grandkids and a bit of exotic travel and voila! — you have the perfect retirement.
If only that were true.
The fact is, most people are not going to retire that easily. Most won’t truly retire at all! Recent studies indicate 70 percent of non-retired Americans plan to work as long as they can during their retirement years, mostly due to financial reasons. Not only that, but Harvard Medical School recently shared findings from the ongoing U.S. Health and Retirement Study that “among 5,422 individuals in the study, those who had retired were 40 percent more likely to have had a heart attack or stroke than those who were still working.”
So what do you do if you don’t want to work in a traditional job but would rather not put your health in decline?
For many older Americans, they look at a franchise business for myriad reasons. Here are just a few.
It fulfills a bucket list goal. In a 2015 survey, Gallup found that 57 percent of Americans would rather have their own business than to work for someone else. The idea of starting a business from scratch can be intimidating for someone in their golden years, but a franchise provides a proven model of success and unmatched support to help franchise owners win in business.
It presents a new challenge. Several studies point out how important it is for seniors to keep their minds active with new challenges in order to ward off brain health deterioration and dementia. For a lifelong employee, the opportunity to start a new chapter as a franchise business owner presents countless new challenges while maintaining a safety net of the franchise system support structure.
They can use their 401K account to purchase a franchise. For most Americans approaching retirement age, the majority of their net worth is tied up in their home and their retirement accounts. Assuming most people don’t want to take out a new mortgage on their home, franchise candidates can instead use their 401K in order to purchase the franchise without taking any tax penalties. Here’s a story from my friends at Guidant Financial on how it works.
It provides income while diversifying assets. Most people will fund their retirements with a combination of annuities and investment accounts, but neither of them are 100 percent reliable. Nothing really is, so having a diversified portfolio to provide income offers protection from financial downturns in one segment or another. For those concerned with diversification, recession-resistant franchises are attractive because they do well when investment accounts suffer.
It offers a legacy. Franchise businesses purchased by parents but operated by their children provide a passive stream of income during retirement and a growth opportunity for loved ones. Quite often, the children will become part- or full-time owners once their parents are ready to divest.
Ready to explore franchising? Give me a call at 919.846.7111 or send me an email at firstname.lastname@example.org.
Jim was excited to join “Money Matters with Matt” again last week to breakdown the ever-popular semi-absentee franchising model and how people can win working on their business without spending too much time in their business. Running time is under 11 minutes.
Think fast: If you called a franchise company you were interested in pursuing, would you know what questions to ask a franchisor?
If you’re like most people, you came up with two answers.
You know who you are.
You’ve been in your current job for long enough and no longer see a future you want. You spend your evenings thinking about how you need a change. You’ve become way too comfortable hitting the snooze button over and over in the mornings rather than getting up to face another day of work. You’ve dreamed of being your own boss, of breaking free from the chains of traditional employment and having a go as a small business owner, but…
You’ve done nothing about it.