Jania Bailey shares insights on buying a franchise and how FranNet can help
BoomersNextSteps.com recently interviewed Jania Bailey, FranNet’s president and COO, about franchising opportunities for Baby Boomers and how FranNet can help future franchisees reach their business goals.
For 25 years, FranNet has helped people achieve their entrepreneurial dreams by matching them with the right franchise opportunities. The company offers an international network of franchise consultants, perfect for Baby Boomers not quite ready to retire.
This year is shaping up to be a banner year for FranNet, which just posted a record year in 2011. The company reported 33 percent more franchise placements in the first quarter of 2012 than in the same period in 2011. The International Franchise Association predicted at the end of 2011 that more than 14,000 new franchise locations would open in 2012 — and FranNet’s 2012 performance leads Bailey to suspect the IFA’s predictions were conservative.
Bailey said FranNet works to clear away misconceptions about franchise ownership and educates potential franchisees on the unique opportunities in business ownership. “When you say ‘franchising,’ most people think McDonald’s and a million dollars,” Bailey said, “but it’s a far more diverse field than it used to be.”
One key advantage in franchising is that all systems are already in place, taking away the overwhelming feeling of starting from scratch.
“There are so many opportunities,” Bailey said. “People have to take their blinders off and explore a little bit.” Bailey dispelled some common myths among franchise ownership.
Franchises Cost Too Much
As many Americans – including Boomers — have seen their savings and financial portfolio dwindle over the last 5 years, there’s a common concern that opening a franchise is too expensive. Bailey is quick to point out that more than 50 percent of the approximate 3,500 franchises cost less than $100,000 as a total investment, including among other things franchise fees, equipment and any product inventory necessary to operate the business. “
As a rule of thumb, we suggest our clients need about 25-30 percent of liquid capital available to them in order to buy into a particular franchise,” said Bailey. “So for a $100,000 franchise, you’d need about $25,000 – $30,000 in liquid capital to get going. When you include your 401K or other cash assets, business ownership becomes a lot more feasible when talking in those terms.”
This Economy is a Terrible Time to Start a Business
There’s no doubting that this economy has been tough on many businesses. But working through FranNet, Bailey says they can help potential business owners find businesses that are more “recession-resistant.”
“For instance, your hair doesn’t know that the economy is struggling – it’s going to keep growing,” jokes Bailey. “So hair care companies are still thriving because people are still getting their hair cut. But instead of the expensive salons, they’re downsizing their hair care to more affordable options,” Bailey said.
Another industry example Bailey pointed out is the automotive repair business.
“The average age of the car on the road today is 10 years old,” said Bailey. “People are not trading in their cars for the more expensive upgrade. Rather, they’re investing in the ongoing maintenance and repairs necessary to make their cars last longer.”
Bailey suggests those interested in business ownership contact their local FranNet consultant to address issues people may see as pitfalls.
As Bailey says, “We’ve seen it all. After being in business for 25 years, we’ve addressed about every concern there is and can typically find ways to make it work.” About the author: Jania Bailey is President and COO of FranNet www.frannet.com) and author of “Thriving – The Journey to Success in the Business World.”