There's no hidden formula for business success, but here are guidelines for starting a profitable franchise
WHETHER IT'S THAT BUSINESS TRIP TO MIAMI or a vacation getaway to the Bahamas, consumers will always need to make travel accommodations, as Leo and Gwendolyn Miller realized when they bought a Travel Network franchise seven years ago.
"I always enjoyed traveling and making the arrangements whenever we vacationed," says Gwendolyn, 62, a teacher at St. John's University. The Millers were impressed with the company's support system. Travel Network, a full-service retail travel agency headquartered in Englewood Cliffs, New Jersey, trains future owners in every area from sales to marketing. Founded in 1982, it boasts some 300 franchises in 35 states, of which 37 are black-owned. The Millers, who grossed $700,000 in sales revenues last year, say their success is tied to their clients' strong allegiance to the franchise, which in turn means repeat business.
The Millers belong to an ever growing group of more than 8 million people who draw their paychecks from franchising. They come from every walk of life, from corporate professionals to homemakers. Travel to any town in America and you're bound to find a franchised business. There are more than 500,000 of these business in the U.S., generating more than $8 billion in sales.
Owning a franchise offers you the freedom to become your own boss without having to start a business from scratch. But don't think franchise ownership is easy. Yes, you can expect training and support from the franchisor, but you have to manage the business--which often means 70-hour work weeks.
Here are 10 important rules to help you understand what's required in operating a franchise business--before you invest.
1 KNOW THYSELF
Do you have relevant management experience? Are you able to juggle various roles? Can you adhere to strict guidelines? Do you know how to delegate tasks efficiently? If you answered yes to the above questions, you may have the making of a franchisee. However, there is still one important question you have to ask yourself: will you enjoy the work?
After working 10 years as a senior accounting executive for the Kendall Co., Matthew Ware decided to launch his own business. While serving on the city council in Athens, Georgia, Ware met Walter L. Padgett, founder of Padgett Business Services, a small business accounting and tax service franchise.
After reviewing several similar firms, including H&R Block, Ware decided to open a Padgett Business Services franchise. "I liked their approach to business and expertise," says the 39-year-old entrepreneur, who is now using his expertise to help small and micro businesses. Taking his personal savings--about $50,000--Ware started the business in 1991. Last year, sales topped $145,000.