Almost everyone with ambition at one time or another thinks about owning their own business. For many, it is nothing more than a passing thought.
Others give it more careful consideration, but they never follow through. This article is written to give those who are serious about business ownership some helpful insight.
Important First Step
The first, absolutely critical step is an honest self-appraisal. Sure, the thought of ‘being the boss’ appeals to almost everyone. It is too easy to consider only the fun parts. All too often though, the other side to those fun parts gets ignored.
That is, to coin a worn-out phrase, ‘where the rubber meets the road’. An honest inventory of self must also include those unpleasant ‘what-ifs’. Check out some of the more sobering questions below to help you decide if franchising is right for you.
Money is the first concern. An unforeseen lack of it is also why most businesses fail. What is your personal financial situation? This includes every source of money you have. Total these. This is your business start budget.
Did you notice under Personal Finances we did not include loans? You must decide for yourself, but generally, loans are not a wise idea when starting a business.
Why? They must be repaid, with interest, whether your business venture succeeds or not. You are in essence doubling your load at the start line.
Loans unnecessarily encumber the whole process of starting a business. Now you have doubled your burden, the business and the bank.
Not only do you have all business startup responsibilities, you must now visit the lender monthly and hand him a goodly portion of your hard-earned profits.
Guess what. Whether your business generated enough earnings to make the loan payment or not, it is still due. Does this sound like something you would recommend to a friend?
Okay, so you have gathered and totaled all your financial resources. You now have a set figure in mind for your business startup. The next step is to select a business that has startup costs well within your finance pool.
By well within, we mean you have enough money to meet all startup costs plus at least 30 percent. Business budgets must always contain margin. Margin is extra money for when business expenses exceed income.
In the business world, it is commonly known as ‘staying power’. Do you have enough money to stay in business while potentially days or weeks go by without making any profit?
Franchising May Be the Answer
For many, the above concerns are enough to conclude that maybe business ownership is not for them. For the resolute among you, franchising just may be the best answer.
Franchising is basically buying into a business that is already successful. The originator of the franchise has already conquered the startup obstacles common with new businesses.
The brand is established. Demand for the product is already existent. Partnering with success is a much easier path than striking out on your own.
Business ownership is not for everyone, but franchising is definitely a much easier way to enter the entrepreneurial lifestyle.