Anybody Have Good Franchise Ideas
September 8, 2005 8:04 AM Subscribe
What are some really good franchise opportunities for somebody looking to start a business? Any tips about what to look for and what to be sure to avoid?
I've been getting an itch to start my own business. My background is marketing oriented. I'm interested in selling a service more than I am a product. I'd very much prefer something that can be sold through advertising and marketing as opposed direct sales, which I would not be at all comfortable with (and which eliminates the most likely choice given my career to date -- marketing consulting).
I've had a few ideas, but as I explore them, none of them seem very interesting and/or workable. Just because none of my ideas seem to click with me, I keep coming back to franchises as a sort of business in a box concept. I'm far from sure that a franchise would be right for me, but I feel like I need to explore it at least enough to intelligently dismiss it.
Part of the drive here is to build something for myself. I enjoy creating systems and putting my stamp on them. I enjoy a high level of creativity. I'm not sure how much freedom I'd have within a franchise concept, and a lot of them just seem like you're paying somebody for the privilege of being one of their store managers. Also, as I look at them, I can certainly see how the person selling the franchise gets rich, but it's sometimes a good deal less clear how the person buying the franchise gets rich.
Mostly, I have money to invest in a business, but I'm prepared to invest whatever time equity I need to in order to get it running. However, I'd like to be able to keep my current job as a safety net, and at least part of the drive is to get to a point where I can generate passive cash-flow.
I found a strongly related question here, but none of those answers exactly addressed my needs.
I've been getting an itch to start my own business. My background is marketing oriented. I'm interested in selling a service more than I am a product. I'd very much prefer something that can be sold through advertising and marketing as opposed direct sales, which I would not be at all comfortable with (and which eliminates the most likely choice given my career to date -- marketing consulting).
I've had a few ideas, but as I explore them, none of them seem very interesting and/or workable. Just because none of my ideas seem to click with me, I keep coming back to franchises as a sort of business in a box concept. I'm far from sure that a franchise would be right for me, but I feel like I need to explore it at least enough to intelligently dismiss it.
Part of the drive here is to build something for myself. I enjoy creating systems and putting my stamp on them. I enjoy a high level of creativity. I'm not sure how much freedom I'd have within a franchise concept, and a lot of them just seem like you're paying somebody for the privilege of being one of their store managers. Also, as I look at them, I can certainly see how the person selling the franchise gets rich, but it's sometimes a good deal less clear how the person buying the franchise gets rich.
Mostly, I have money to invest in a business, but I'm prepared to invest whatever time equity I need to in order to get it running. However, I'd like to be able to keep my current job as a safety net, and at least part of the drive is to get to a point where I can generate passive cash-flow.
I found a strongly related question here, but none of those answers exactly addressed my needs.
Entrepeneur has an online magazine here that you should look at. Be cautious in picking something; supposedly the majority of franchises only make money for the people selling them. Admittedly this is just a version of Sturgeon's "90% of everything is crap" meme but it bears keeping in mind.
Unfortunately keeping your day job (a concept I strongly support) undercuts one of the things that helps new businesses keep costs low: not paying for the labor of others.
Personally if I had the money to afford the land I'd get into the self-storage business. I've yet to see one not do a booming business in a reasonably well populated area.
posted by phearlez at 8:43 AM on September 8, 2005
Unfortunately keeping your day job (a concept I strongly support) undercuts one of the things that helps new businesses keep costs low: not paying for the labor of others.
Personally if I had the money to afford the land I'd get into the self-storage business. I've yet to see one not do a booming business in a reasonably well populated area.
posted by phearlez at 8:43 AM on September 8, 2005
In my opinion (and likely not what you're looking for) the next big food franchise. I've talked to a couple franchise owners and they are ecstatic with the responses they're getting.
posted by Kickstart70 at 8:44 AM on September 8, 2005
posted by Kickstart70 at 8:44 AM on September 8, 2005
Thanks for the link Kickstart70... dam now i want a pita.... a pita to the extreme that is
posted by matimer at 8:50 AM on September 8, 2005
posted by matimer at 8:50 AM on September 8, 2005
Check out the SBA's info on buying a franchise. I would look into financing sources (the SBA and others with SBA licenses) as they may be able to point you in the direction of viable opportunities.
posted by mullacc at 9:41 AM on September 8, 2005
posted by mullacc at 9:41 AM on September 8, 2005
I think Cereality would be great in dense urban areas or near college campuses. Maybe if someone who's been to one of the locations can comment on the popularity of this chain?
posted by junesix at 10:02 AM on September 8, 2005
posted by junesix at 10:02 AM on September 8, 2005
I think you're on the right track, wanting to build something yourself. One of the attractions of a franchise is the marketing they offer, but you seem to have a head start on that already. I'd suggest you first look at your interests and hobbies. Is there anything you can pull from these that somebody else might need?
There's a guy here Maine who started and runs a successful business called rent-a-husband. He's offering a common handyman service, but the hook seems to be in the name. It's gotten him a great deal of local and national press. What I find amazing is that he's franchising the idea, which reinforces the idea that there's where the real profit is.
posted by SteveInMaine at 10:26 AM on September 8, 2005
There's a guy here Maine who started and runs a successful business called rent-a-husband. He's offering a common handyman service, but the hook seems to be in the name. It's gotten him a great deal of local and national press. What I find amazing is that he's franchising the idea, which reinforces the idea that there's where the real profit is.
posted by SteveInMaine at 10:26 AM on September 8, 2005
I suspect you may find a franchise frustrating. Franchising depends on the economies of scale from replicating a production system. In other words, someone else has already done the creative work and now it's up to you to roll it out. Given your marcom background, you may find this frustrating. Would you be happy if the only changes you could make were in how you greeted customers? Would you be frustrated with template ads, direct mail, websites, email, and other tools? If your only creative outlets were in direct sales, would you be okay with that?
Have you ever worked for a franchise? Getting a job with one -- perhaps as a step in deciding whether to buy or simply whether you could deal with a franchise -- may give you a feel for the franchise experience. When I worked for a major submarine sandwich chain, I found it frustrating, because I couldn't use my wits to improve systems. On the other hand, the store manager -- a former private in the military -- and the local franchise owner -- a former police officer -- thrived in the environment. But they were people who thrived in tradition and official systems. You may want to look at profiles of other owners of franchises to see if you have a common bond. (If you look at the profiles of the people who started some of the franchises, you may be more likely to see yourself -- take a look at the Cereality owners.)
And, as noted above, you can read up on the merits of franchise opportunities. The FTC has some good information. Perhaps you can find some franchises that will allow more flexibility.
posted by acoutu at 11:25 AM on September 8, 2005
Have you ever worked for a franchise? Getting a job with one -- perhaps as a step in deciding whether to buy or simply whether you could deal with a franchise -- may give you a feel for the franchise experience. When I worked for a major submarine sandwich chain, I found it frustrating, because I couldn't use my wits to improve systems. On the other hand, the store manager -- a former private in the military -- and the local franchise owner -- a former police officer -- thrived in the environment. But they were people who thrived in tradition and official systems. You may want to look at profiles of other owners of franchises to see if you have a common bond. (If you look at the profiles of the people who started some of the franchises, you may be more likely to see yourself -- take a look at the Cereality owners.)
And, as noted above, you can read up on the merits of franchise opportunities. The FTC has some good information. Perhaps you can find some franchises that will allow more flexibility.
posted by acoutu at 11:25 AM on September 8, 2005
If you want to try an educational franchise, you might look into something like Abrakadoodle, a company that creates and runs art classes for children. (Full disclosure: My wife works for the company.)
posted by cerebus19 at 11:29 AM on September 8, 2005
posted by cerebus19 at 11:29 AM on September 8, 2005
Forget about getting rich; for an individual, franchises aren't the way to do that, unless you get in on the ground floor (a cut-rate franchise agreement you can keep even as the system grows, a territory bought cheap when it was mostly farmland and is now an exurb, etc.)
However, franchises are a great way to make living and a return on investment if you happen to be one of the rare people who can't earn a high salary in employment, but who has a pool of cash to invest.
Example: imagine you have $250,000 in cash, but can't get a better salary than $50,000 a year. Buy your franchise for $50,000, build out the business for another $100,000, and keep $50,000 in reserve. Once your franchise gets up and running with your full time efforts, you might be able to pull $100,000 a year out of it. You're earning your market salary ($50,000) plus a 25% return on your $200,000 investment and reserve. Add in the hedonic value of being your own boss, and it's nice indeed.
As for being creative, what acoutu said. Most franchisors won't let you be creative, and those who will reserve the right to apply the fruits of your creativity to all their other locations without compensating you. Not good.
posted by MattD at 1:36 PM on September 8, 2005
However, franchises are a great way to make living and a return on investment if you happen to be one of the rare people who can't earn a high salary in employment, but who has a pool of cash to invest.
Example: imagine you have $250,000 in cash, but can't get a better salary than $50,000 a year. Buy your franchise for $50,000, build out the business for another $100,000, and keep $50,000 in reserve. Once your franchise gets up and running with your full time efforts, you might be able to pull $100,000 a year out of it. You're earning your market salary ($50,000) plus a 25% return on your $200,000 investment and reserve. Add in the hedonic value of being your own boss, and it's nice indeed.
As for being creative, what acoutu said. Most franchisors won't let you be creative, and those who will reserve the right to apply the fruits of your creativity to all their other locations without compensating you. Not good.
posted by MattD at 1:36 PM on September 8, 2005
Sorry, just gotta say, Cereality rocks. Chicago has the first urban Cereality and I swear I go there at least once a week. The place is the best and there's always a line around the corner. Similarly, Potbelly also has lines wrapped around the block. You think I'm joking, but they literally do. If I had the money and the wherewithall to open a franchise, I'd choose Cereality or Potbelly.
posted by MeetMegan at 1:48 PM on September 8, 2005
posted by MeetMegan at 1:48 PM on September 8, 2005
Maybe Massage Envy? It seems to be doing quite well here in Dallas.
posted by LeiaS at 6:15 PM on September 8, 2005
posted by LeiaS at 6:15 PM on September 8, 2005
This thread is closed to new comments.
posted by willnot at 8:07 AM on September 8, 2005