ABC News recently reported that the unemployment rate was 9.4 percent, the highest level since August 1983. Don’t become a statistic.
Perhaps you have been working for your company for many years, maybe you play a vital role in growth and expansion, and quite possibly you have earned the respect of everyone around you. While all of those descriptions may be accurate, the larger truth is that in this economy, no one is safe.
The United States Department of Labor, Bureau of Labor Statistics, reported that 2,712 employers conducted mass layoffs in April 2009, resulting in the loss of 271,226 jobs. In one month! In one month more than a quarter of a million people went from gainfully employed to the unemployment line. Why allow yourself to be next? Why become the next victim of this vicious and uncaring economy?
You don’t have to be a sitting duck. In fact, you could turn around tomorrow, realize the American dream and become your own boss.
According to a 2007 BusinessWeek article, nearly 500,000 people create new businesses each month and while many of them fail, a great handful of them go on to incredible success, even in a recession. While at first glance it may seem inauspicious to start a new business venture during failing economic times, studies show that a recession can actually be the ideal time to launch a company that recognizes the state of the economy, identifies a market need and addresses it. Companies like Burger King, International House of Pancakes, LexisNexis and Trader Joe’s all started during economic slumps, and all have prospered.
Embarking on a new business venture, whether during economic prosperity or recession, means hard work, long hours and a lot of what often goes overlooked: planning.
According to the Small Business Administration (SBA), two-thirds of new businesses survive at least two years and 44 percent survive at least fouryears; that’s a 22 percent decrease over two years. Why do so many fail? The number one answer of various experts is improper planning. Business planning is crucial to business success. Before starting a business, you need facts about your industry, customers and potential profitability. Those who start successful businesses often spend months, or even years, conducting research and creating business plans.
So what happens when you don’t have the time or attention span for all that research? Thankfully, you are not relegated to life as a nine-to-five worker-bee. One option allows you to go out on your own and become your own boss without the research hassle: franchising.
When you buy a franchise business, you take a much smaller risk than when you start a business from scratch because the franchisor has already done all the research, set the plan in motion and seen franchisee’s succeed using their business model. Franchising gives you all the freedom of being your own boss, but still offers you the guidance and assistance you need. In most cases, you can start out with a small financial investment and grow your business over time. There is also a much smaller chance you will be stuck without a pay check for too long, especially because some franchises offer you a guaranteed initial customer base.
While buying a franchise business may often seem like the easy answer, there are things to consider before embarking on your journey.
The following are seven key items to mull over before leaving your job to become an entrepreneur:
1. Evaluate Your Current Position. Often, when a person is about to be laid off there are signs. If the company is trying to phase out your position, you will likely be given less work, brought into fewer meetings and left out of conversations that discuss the future. If you were passed up for a promotion, think about who got it. Is it someone younger and less experienced who will do the job for less pay?
Additionally, consider your job satisfaction. Are you happy with your position in the company? Are you satisfied with your salary? If you are unsatisfied that may come through in your attitude and work performance and your company may opt to lay you off rather than give you what you want, especially if they are going through tough financial times.
2. Take A Hard Look At Your Finances. Starting a business, whether it be a franchise or a brand new venture, will require some start-up capital. Do you have money in savings? Also, consider whether you can afford not to have a bi-weekly paycheck for a few weeks or months while you set your plans in motion. If not, try saving as much as you can now before you leave your job and steady income.
When considering franchising, consider the lessened financial risk. Since the franchisor already has a proven model for success, you are not trying to reinvent the wheel with each decision, you will simply be following what others before you have successfully completed. Additionally, a franchisor may require a smaller financial outlay and allow you to grow your business over time.
3. Get Your Family’s Buy-In. This step is all-important because as any entrepreneur knows, you must have support to be successful. Thoroughly discuss your ideas with your spouse and come up with a plan of action together. Remember, your family members will be stakeholders in this business too. Whether they will be directly working for the company or not, they will be directly affected your success. It is always a good idea to get the family’s approval when starting on a new course; you will need their encouragement when times get rough.
4. Speak To A CPA. There are several items that can complicate leaving your job. For example, if you have a 401K or stock options, you will want to talk to a professional about how they will be affected if you terminate your employment. It is a good idea to talk to an independent CPA to discuss any potential losses and the best ways to extricate yourself. Remember, you do not want to discuss this with your company’s HR department unless you are ready to tip them off that you will be leaving.
A CPA will also be able to tell you exactly what expenses you should be keeping track of now that you intend to open your own business. It is best to get this advice from the very beginning so that you don’t have to go back and attempt to organize old information.
5. Look For Alternate Health Insurance. Something that can often complicate termination of employment is health insurance. Are you on the company’s health insurance plan? If the answer is yes, you may want to check out alternatives before you leave your job. If your spouse can add you to his/her company plan, that may be the simplest solution. If not, you should start researching other health insurance options. This is another expense you must consider when starting your own business.
6. Consider A Business Partner. Two heads are better than one. As are two wallets, two sets of hands and two sets of skills. Starting a business can be a huge responsibility, both financially and logistically. Adding a business partner can be just the thing to help you be successful.
If you don’t want to go into business alone but don’t like the idea of a partner, franchising may be right for you. Typically, franchising offers significant assistance by way of training courses and support staff that can be indispensible for a first time entrepreneur. When you do well, the franchisor does well and they will do everything in their power to ensure their success.
7. Contact a FranFinders Franchise Consultant. When beginning your search for the right franchise, the multitude of options can seem overwhelming. After weeks or months of sifting through information, you may end up with more questions than you started with.
The best way to ensure you are getting all of the information you need is to speak with a franchise consultant who can guide you through the process and answer any questions you may have. Much like an executive recruiter, a franchise consultant matches qualified candidates with compatible franchise concepts, meeting the needs and objective of all parties. The franchise consultant will ask you about your experience and qualifications and come up with a list of potential franchises that may be right for you. That list will then be narrowed down based on the amount of initial capital you wish to invest, your geographical location and any other requirements you see fit.
For example, you may be looking for a franchisor that offers in-house financing, one that offers health insurance options to its franchisee’s or perhaps you are looking for an opportunity that offers collection and billing assistance. A franchise consultant can find you all of that information, instead of you spending weeks digging through piles of advertisements, websites and marketing materials.
Furthermore, seeking the help of a franchise consultant will cost you nothing. Franchise consultants are paid by the franchisor and will never charge you a penny. There’s nothing to lose, but so much to gain.
For those of you sitting at your desk, waiting for the hammer to drop and hoping it doesn’t hit you, consider these seven items and decide if now is the right time for you to make a move that will change the course of your life and your career forever. Many people have dreamt of firing their boss, but only a small number of people actually do it and succeed at it. Franchising offers you the opportunity to take a proven model of success and apply it to your business.
Put your career in your own hands. Contact a franchise consultant, today.
Posts
