The beauty of a franchise system is that much of the risk that comes with starting up a business is mitigated, which increases your chances for success—if you follow the model. But like anything else, there are certain qualities, characteristics, and experiences of the franchise owner that can help propel you to top-performing status.
With the average initial investment for a franchise being $250,000, having the confidence that you possess the skills to run a successful franchise may help you get past your fears and take the next steps toward entrepreneurship. Of course, success can be measured in a number of ways, but as a benchmark, I advise clients that for every $100,000 of capital they invest, they should anticipate making at least $15,000 per year in ROI. Most franchises, particularly in the service industry where overhead costs are lower, yield between 20%-25%, after calculating for both the active and passive investment costs.
Franchises are attractive to corporate professionals because they provide the autonomy professionals seek from an independent business and the systems they appreciate from corporate life. Certain professional experience can also lend itself to achieving that ROI goal quicker and in many cases, top-performing status, regardless of industry or sector experience.
- Sales Executives: Sales executives are typically responsible for a designated sales territory, P&Ls, KPIs, and support staff. In other words, they’re already running a small business within a corporation. Making the leap to franchise ownership can be a lot easier because they are used to their income being based on their level of production, rather than the time they put in. When times get slow, they’re not intimated by the lull, and they understand the nature of the business cycle. In addition, sales executives thrive off of the idea that there is unlimited earning potential, driven by their own actions.
- Military: Similar to the military, franchises provide a clear mission and the protocols for achieving it. Ex-military professionals understand they are part of a larger unit and working together to achieve greater success. They’re not alone, and if they need guidance or assistance, there’s a clear path to where they can go to get it. The military also provides confidence- and leadership-building, traits that any great business owner will need to have.
- Directors / Mid-level Managers: Some of the fastest-growing franchise sectors, such as senior care and child enrichment, require franchise owners to spend a good deal of time hiring and managing staff. For professionals that have experience in tasks such as reviewing applications, interviewing, training, assessing performance, and mentoring, they can quickly get a strong team up and running. These skills are also invaluable in acquiring customers.
- Accountants: One of the biggest fears people have about owning a business is if they have enough financial intelligence to know what they’re doing. And while there are books you can read and classes you can take to gain this knowledge, professionals that have a background in accounting are already quite comfortable with spreadsheets, financial calculations, and problem-solving. They also tend to have established professional networks with attorneys, financial planners, and small businesses—which can all be very useful when building a franchise.
You shouldn’t give up on your dream of franchise ownership if your profession is not on the list. If you have read any number of my articles in Black Enterprise where I interview franchise owners, then you know that teachers, dancers, athletes, and police officers have been wildly successful in franchising. However, for professionals with one or more of these skill sets in their background, the career transition and speed to success can be that much easier.