Entrepreneurs are most often associated with two words: creativity and risk. They are the people who want to be the first in their field to offer something new, exciting and different. For them, a new business venture is created out of nothing. Limited only by finances, these innovators ‘enjoy’ the ultimate freedom of expression.
[dropcap]F[/dropcap]ear of failure is a constant companion, as entrepreneurs travel mile after mile of new business territory. There are no maps to follow, no roads leading anywhere specific. This trip is punctuated by one-way streets, dead-end forks in the road, and sightless tunnels. The only thing the entrepreneur knows is that s/he must keep going. The challenges come hard and fast at times. Most entrepreneurs will admit that although scary, the creative reactions to daily business problems are the core of the experience; for they bend and mold the organization and its people into something far beyond imagination.
Are the individuals we feature in Capital at Play super human? Is there a genetic predisposition for small business success? No. However, a trait that all of them seem to share is the inability to feel satisfied working for someone else. They can’t help it; they’re born that way.
What about you? Are you a trailblazer, or are you more comfortable following a well-marked path? Many of us dream, but uncomfortable with the open ended task of creating a new business, we migrate toward steady jobs with companies that can use our talents. If you aspire to become self-employed, but lack the courage of your ideas, there is a middle ground: franchising, a way to operate a small business within the relative safety of a proven formula.
EE’s and OR’s
When you purchase a franchise, you become the franchisee. In exchange for some start-up costs and a percentage of your future sales, the franchisor licenses you to operate as a satellite facility selling the franchise’s products and services. Your new business bears the same logo, advertising and overall appearance. The parent franchise has already established a brand recognition and quality reputation, so your venture has a head start; all you have to do is run your location. You’re in business for yourself, but not by yourself—the franchisor industry’s mantra.
For the franchisor, franchise partners provide the company with an affordable way of expanding the business with very low risk. It’s a mutually beneficial relationship, and it works well as long as the franchise unit owners follow the rules, because consumers, once they’ve latched onto a brand, demand consistency.
Imagine striding up to the counter with a Big Mac on your mind, only to find out that this particular McDonalds no longer sells them! Franchises live or die by the rules. In business for themselves, but playing by the rules, individual franchise unit owners become corporate super-employees—they have skin in the game—because of their financial commitment.
Business brokers and franchise consultants we’ve spoken to agree that franchises target corporate employees looking for change. Successful corporate life is predicated by an employee’s ability to work within the confines of company policy. It is no surprise then, that when they retire, or are laid off, corporate professionals are drawn to opening franchises.
Doug Boehme, Regional Director for the Central Indiana Small Business Development Center, explained that the people most likely to purchase a franchise are corporate employees who have been laid off more than once. “These are people who love company life but were blindsided by layoffs. They now want to control their destiny,” Boehme said. “They thrive in a corporate setting, because they understand the need for following company policy, they are the ideal franchisees.”