We recently held a free business seminar, “How the Right Franchise Opportunity Can Accelerate Your Movement Up the Entrepreneurial Ladder,”presented by ActionCOACH and the Entrepreneur Authority of New Jersey. Here is some important information you missed:
Here are the 6 Rungs of the Entrepreneurial Ladder, which includes employee, self-employed, manager, owner, investor, and entrepreneur.
- Reasons to be an Employee: As an employee, you build practical knowledge and experience. You also want to pay close attention and learn from others, and be sure to ask a lot of questions (very handy for future endeavors). You earn your money by what you “do” in order to maximize your earning potential.
- Reasons to be Self-Employed: During this time you learn a lot about the company structure including sales and marketing, accounting, the true meaning of hard work, networking and making contacts, responsibility and accountability. Being self-employed you can make your own money and also pay less in taxes.
- Reasons to be a Manager: This is where you create a team, hire employees and conduct training. This is where you are designated to have “many hats” and also build relationships, learn to make quick decisions, and gain trust. As a manager, you manage the making of money and encourage your team to work hard in order to have a large return.
- Reasons to be an Owner: As an owner, you have more time for yourself socially and personally. This is a time where you can invest, start more businesses and start a new career. You will have a passive income stream where you receive the profits as you lead your team to maximize those profits.
- Reasons to be an Investor: You should master investment strategies in businesses, real estate and the stock market and live by the motto, “Learn, Buy, Build, Sell” or “Learn, Buy, Renovate, Sell.” As an investor, you invest in capital and get a “return on investment.”
- Reasons to be an Entrepreneur: Everything you buy is a business expense because you are “business.” Entrepreneurs have influence and bring information and opportunity while achieving their dreams. As an entrepreneur, you don’t have to work for your money because your money is working for you!
Do you know where you are on the Entrepreneurial Ladder? Remember, focus on the highest priorities, execute at the highest level, and accountability increases urgency and frequency. Always test for effectiveness, efficiency, productivity and leverage.
Here are the 5 Keys to Evaluating a Franchise:
- Level of investment and potential ROI: When looking at a franchise the initial investment should be something to consider but the investment versus the ROI (return on investment) should be the main focus. Many franchises are “low cost” but also produce very little in the way of profit. There is a direct correlation between the cost of the franchise and the revenue generated. Though not absolute it is not a good idea to pick something just because it has a small price tag.
- Strong Training and Support System: Picking a franchise that has a strong training program will help the business get off the ground from the start. The first several months will help determine how successful the business will be in the long run and it is always a good idea to make those months as productive and positive as possible. Determining whether the franchise has adequate and easy to obtain support going forward will also make the business easier to run when difficulties arise.
- Territory Assignment: Does the franchise offer any sort of territory protection? If the franchise is a physical location then having protection from another franchisee locating too close is something that needs to be considered. If it is a consulting type business or not location dependent, does the franchise limit the number of franchisees in an area?
- Success of the Franchise: Checking into how well the franchise is doing will help to better understand if the business model has been successful up to this point. That includes talking to as many existing franchisees as possible to see if they are happy and would purchase the franchise again. Understanding how many locations have closed or changed hands and why that has happened is always a good idea.
- Are they Future Thinking?: Some franchises get caught up in past successes and do not look forward to make sure that they do not wind up behind the curve. The franchisor should always be working on something new whether it is a new product or new service. Even hamburger companies are coming up with new products on a constant basis to make sure customers do not become tired of their product and go somewhere else.
Ed Kozemchak mentors business owners and their leadership teams, executives, sales professionals, and professional services providers. He coaches them to take the actions they must take to overcome or eliminate their greatest challenges so they reach their true potential. Over the last 30 years, he served as a successful business executive, business owner, and business/executive coach. He has personally coached more than 250 business owners and leaders. As the leader of a professional services business, he doubled revenues every year over a 5-year period and grew the professional services team from 10 to 250 people over that same 5-year period. He breaks down business challenges into smaller, more manageable pieces to create successful solutions and provides his clients with knowledge, focus, and accountability.
Neil Sullivan is the owner of Franchise to Win, LLC, an independent affiliate with The Entrepreneur Authority (TEA). TEA is the only franchise consulting service that has the endorsement of the American Association of Franchisees and Dealers (AAFD). Neil has a great deal of first hand experience with the franchise industry. Prior to joining TEA he was a multi store Franchisee of Data Doctors Computer Services franchise for over 8 years. Neil has also started and ran 2 independent companies before Data Doctors. He has extensive knowledge of running companies day to day and the challenges that face both independent and franchised businesses.