The following is a guest post by Betsy Fallwell. If interested in submitting a guest post, please read my guest posting policy and then contact me.
Are you satisfied with your job? A 2012 survey found just 19 percent of workers – that’s less than one in five – are happy with their career path. What do the remaining 81 percent of us have in common? According to another study, the majority of us dream of working for ourselves.
I was one of those people. Three years ago, I was an active – if unwilling – participant in the rat race, working 50 hours a week at a desk job that netted me barely enough to pay my mortgage and student loans. I thought I was trapped in my job; I certainly felt trapped. But as I began to explore ways I could work for myself, I started to realize that the only things holding me back were my own preconceptions.
Today, I’m happy to say I’ve been my own boss for the past two years. It’s a line of work, as well as a lifestyle, I adore. Here’s how you can make it happen for you.
Identify Your Niche
One of the most successful ways many budding entrepreneurs end up working for themselves is through business franchising. Franchise opportunities abound; there are literally options in almost every industry, at every price point, for every interest. For example:
- Mortgage broking: this typically entitles very little up-front capital, as many existing franchises allow you to work out of your own home; however, you may be subject to a royalty fee to your parent company on every transaction
- Fitness: Curves is one of the best-known business ideas around, but there are also fitness chains that cater to men, both genders, and age groups from teenagers to seniors
- Restaurant: this is an option that typically requires large amounts of capital to buy-in to the franchise model; you’ll also have more success if you have previous hands-on experience in the food services industry
- Home cleaning and janitorial services: most companies no longer employ an in-house janitorial staff; instead, they contract out the work to individuals and companies. This is an option that requires minimal overhead, as cleaning supplies are relatively inexpensive, and you’ll always be working in someone else’s space – eliminating the need to rent a pricy office
- Direct sales: Thirty-One, Silpada, Pampered Chef – these are all examples of direct sales franchise opportunities that require just a few hundred dollars up front; after that, you can sell as little or as much as you want
Picking the Right Franchise
Say you’ve decided that buying in to an existing restaurant franchise is the right path for you. Now, you’ve got to figure out which parent company to sign on with.
Perhaps you’ve narrowed the franchise opportunities down to two options: a well-known restaurant chain with a pricy buy-in up front, or a less-established chain that requires little to no financial commitment to launch. While the second of the two business ideas may be enticing, it could also be more of a risk. As with everything else in this world, you get what you pay for; when you work with an established company that has a strong track record of success and a positive reputation with consumers, expect to pay a little extra – after all, the company needs to ensure you have the chops (and financial capital) to continue the company’s success, and you’re paying for their strong reputation.
That’s not to say signing on with a less well-known franchise model is always a bad move; every franchise has to start somewhere, and it can ultimately pay to take a risk by joining on the bottom floor. But be sure to do your research to make sure the company has a strong reputation with consumers, otherwise you may have a tough time reversing negative preconceptions.
Secrets to Success
Once you’ve settled on these business ideas and started putting them into place, it’ll largely rest on your shoulders to bring in new customers and keep them satisfied. Anyone who’s ever worked for herself knows that self-employed individuals share many of the same characteristics:
- Motivated – There won’t be anyone looking over your shoulder to make sure you’re getting the job done. If you’re not a self-starter, this career path is going to be a difficult one
- Perseverance – Even the best business owners encounter bumps along the road; if you can’t muddle through the tough times, you’ll never be able to rejoice in the good ones
- Thinking out of the box – There’s more than one way to solve a problem, sell a product, or attract new customers; the best business owners bring creativity to the table
In exchange for all the hard work, you’ll be able to reap the rewards – not just financial perks, but positive changes to your lifestyle as well. Today, I’m in complete control of when and where I work. Some days, I may put in 12 hours at my desk; others, I may be able to take the impromptu afternoon off. There’s no more office politics to get in the way of focusing on work, and I don’t have to bother with doing my hair or makeup before rushing out the door every morning.
We’ve thought about going into a franchise, but in the end did not want to pony up the up front money. Though, the structure a franchise can provide can be helpful to many. We run our own business and thankfully there was no up front cost per se. Being your own boss definitely has its perks.
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Some franchises are quite expensive to join, but it would be extremely beneficial to have an existing brand to stand behind and have the entire business model developed. For many people that ends up being a much safer option than trying to start from scratch.
I have definitely thought about a franchise. I used to work at a clothing store that my boss has. It’s a franchise and she makes a decent amount of money from it.
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Personally I haven’t thought much about starting a franchise, but I would love to own my own business someday. Perhaps franchising would be the best route to take for me.
Regardless of what it is, I believe it’s important that everybody is passionate about what they do for “work”. Personally, I enjoy finances and as long as I’m doing something along those lines, then I’d imagine I’d be quite content. Saying that, I’ve thought about owning a franchise, but I’d have to stick to my principles and it would be something that I wouldn’t be willing to go into debt for. With that said, maybe I could be a franchise owner someday…
For sure, I wouldn’t jump into some franchise just to make some money. Owning a business really requires a certain level of passion. When you are committing to running a business like this, you definitely want to be involved in something you have a genuine interest in. If not, you’ll likely be miserable.
I remember watching a special on CNBC about franchising and most franchises have a huge failure rate. You have to do so much planning to make sure the niche is in the right location.
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Interesting to know. I guess the franchise doesn’t care too much if each franchise is successful provided that they pay their startup fees and provide additional exposure. For most franchises location really is so important.
I have a few friends who own franchises and they seem to do pretty well out of them. I suppose the good thing about them is you can usually hit the ground running if you buy into a well known brand, the bad thing is you often have to pay a large chunk for that privilege.
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There are definitely pros and cons, but when you think about it, it might take even more money to really establish a brand new company. For some people, they’d do much better when they have a strong base to start from.
I thought about putting a French bakery franchise in Guatemala, or some kind of gourmet food. The network definitely helps getting products at a lower cost at the beginning since your orders are so small. But the price is often steep if the company is quite successful.
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Yes the lower product cost would be one major benefit, but I guess it depends on much the specific business would need to spend on products. A more successful business would cost more to buy a franchise for. Then again, that big brand might help bring in more customers and they might have a better system.
This is great, and from what I understand, really true. You gotta be freaking motivated and stick with it, if this will work for you.
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For sure, it does take a lot of motivation. Running a franchise is rarely just a 9-5 job. You have to be willing to fully commit and do whatever it takes to make it succeed. If not, that startup fee could end up being wasted.
I have thought about the franchising model for a long time, but just haven’t found one that I would even want to run. While the upfront money can be difficult to swallow, many forget that you get the marketing power of a large company behind you. That in itself can cost hundreds of thousands of dollars.
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Yep, with the right franchise you get the benefit of all kinds of extra advertising that you probably wouldn’t have been able to afford otherwise. Then there are things such as the existing reputation and trust. Customers would be a lot less wary of doing business with you when they already know the company you represent.
My wife dreams of bringing Friendly’s to Colorado, but aside from the pricey buy-in, I feel that a restaurant is a foolish choice in a town with more restaurant seats than residents.
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Yep you definitely have to consider the current market and whether it is already saturated. Then again a popular restaurant might still do well if it’s better than what’s already out there. Restaurants must be popular there if there are so many, otherwise some would close down.
We’ve thought about franchises (casually) in the past, but didn’t have the upfront cash, and wanted to have more control over the business model. It’s something we haven’t ruled out though, and would consider in the future if the right business and opportunity came about.
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The lack of control could potentially be a problem depending on how you would want to run the business. For some people they’d like that kind of structure since it takes away some of the decision making. Upfront cash is definitely an issue for most people who might want to pursue something like this. I guess that’s where the bank comes in most of the time.
Good topic Betsy,
Franchising is a great way to learn the business and then you can take what you learned and branch out on your own.
The lower costs options are what I would recommend because the investment is actually less than the school of hard knocks or college.
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Good point Darnell. You could totally use that experience to learn how a bigger chain operates and take that to a new business. You’d just have to be careful about non-complete clauses.
I’ve thought about this, but it would take tons of up front hours that I don’t have right now. Maybe at some point. We’ve actually been approached to partner into a Little Caesar’s Pizza franchise, but I know nothing about making pizza!
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I don’t think your pizza making abilities would be an issue since it would be the employees doing the cooking. I’m sure they’d provide some kind of training to ensure their standards are met. It would be more important that you’d have a solid plan on how to market the business.
I have never thought of a franchise. Not saying they aren’t a good investment and of course there are many success stories. But for me, the up-front monies it usually takes to get started and then the continuing royalties are better spent starting a business you really know from scratch. That’s just me
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Greg has this crazy dream that we’re going to open a Jimmy John’s sandwich shop franchise one day =)
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That’s a cool dream. I wouldn’t be so quick to shrug off that idea. It would be pretty easy to combine that with blogging and do that kind of work during slow hours.
Franchising has been a proven enterprise. It had its share of ups and downs. For those with entrepreneurial skills, owning franchise and operating it successfully can be the answer to your financial concerns.
It’s worth trying provided you adhere to the basic rules.
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Yes with the way these franchises continue to successfully expand, there is proof that it is working. You do have to be careful with franchise selection though. Some franchises provide a lot more stability while others carry a lot more risk.
We too looked at and met with several franchise operations back in 2010. In the end, the idea that they still technically owned the business and could pull the plug at any time scared us off. I can see though how it could be a great deal for those not as paranoid as us. Plus, we were looking at smaller, less-known franchises, so the risks were bigger than with something like a Jimmy John’s
.
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I would be very hesitant about a smaller franchise. If I were to go into a franchise opportunity I’d much rather be involved with a bigger business with a proven franchise model. Then the whole system would be so much smoother. But yeah, having the company still technically own your business could be an uncomfortable situation. It does limit your options a lot.
Investing into a franchise business can be expensive if you are to engage in a more established one. It also takes a lot of effort for maintenance that will pass the standard set by the owners themselves.
That is a major downside…the bigger the franchise, the more it will likely cost to get in. You do have to pay for that extra level of stability and name recognition. Those are the ones that are more likely to succeed though. So in the end it is probably a worthwhile investment. Having to keep up with someone else’s standards could be a problem, but at the same time that could ensure that you keep everything running smoothly too.