Benetrends

MAR 27, 2017 | Author Molly Klein

Increasingly, American workers are choosing to leave the corporate world and venture forth on their own. These voluntary departures are being fueled by an increasing optimism in the country’s economic outlook, a desire to have more professional independence, and the appeal of being their own boss.

It is worth a closer look to determine why workers are escaping the cube. Why, when, and how workers leave corporate America to pursue entrepreneurial ambitions are complex and important issues to consider.

According to the March 2017 figures released by the U.S. Bureau of Labor Statistics (BLS), nearly 3.2 million people voluntarily left their positions in January 2017. The number of “quits,” as BLS refers to these voluntary departures, grew throughout the private sector, particularly in services, finance and insurance, and real estate.

The January 2017 data reflects an uptick from figures that were consistently between 2.9 million and 3 million monthly “quits” from August to December of 2016.

Economists generally consider “quits” an indicator of healthy optimism, as a good number of those who leave choose to start their own businesses.

Why Leave?

Many employees who choose to leave a corporate gig do so for the freedom and flexibility afforded by starting a business. In addition to the wealth potential, running your own business gives you the opportunity to be more in control of your destiny.

For many, the choice to leave a seemingly secure position in corporate America may seem like a risk.  But in many cases, the climate and culture in the corporate world leaves a bit to be desired. Here are a number of other reasons people are choosing to leave the nest:

1. Office Politics. The nastiness of office politics is a headache that can be avoided when you serve as your own boss.  You will no longer be burdened by coworker infighting, pressured to cater to the whims of a difficult boss, or forced to be a pawn in someone else’s chess game.
2. Career Control. With a corporate job, workers are not always in control of their own career path. The opportunity to be promoted and advanced, learn new skills, or be given valuable work experiences is often at the whims of a supervisor.
3. Declining Benefits. In most areas of corporate life, the notions of company-provided pensions, reliable health care, and other benefits are long gone.  More of those costs are being passed on to the worker.
4. Loyalty. In years gone by, companies earned the loyalty of their employees, providing them with the opportunities and security that allowed for long, productive careers with one company. But today, some corporations no longer value loyalty, and workers have to cope with ever-looming threats of layoffs and downgraded opportunities.

While not everything about corporate America is doom and gloom, there is certainly a great deal of dissatisfaction that employees are feeling about the work being done and the way they are being treated. There is significant appeal to the notion of giving up that corporate life and considering a different type of career.

Should You Consider a Change?

There are many reasons why you might consider leaving your job. But the real question is whether you are ready to make a change. What factors should you consider when it comes to making a major professional transition?

The answers are not always obvious. You need to spend the time to consider if you are dissatisfied with your current situation and if the answer is yes, why you are dissatisfied.

The decision to leave a corporate job is not one to be taken lightly. If you choose to make the leap, there are some things that you can do to make sure the switch is done smoothly and professionally.

The first thing to do is assess whether you are truly making the right choice. Ask yourself what is missing from your current work situation. What are you going to escape to if you leave? What are the opportunity costs to staying or leaving?

Here are some points to consider during the assessment:

• Are you happy? Do you experience joy and relish the work you are doing? Job satisfaction is a powerful motivation. It can provide you with a sense of fulfillment and a feeling that you are part of a greater good. But not feeling that way can leave you with an emptiness that needs to be filled.
• Are you inspired? Do you work with and for people who motivate you and whose company you enjoy keeping 40 or more hours a week? You want to be with people whose work, collaboration, and intelligent thought helps to get work done. You deserve a sense of teamwork and camaraderie. You need a leader who rallies and motivates. If you do not have that situation, perhaps you are the leader who can inspire others.
• Do you love your work? You spend years of your life at work. You deserve to live a life that is fulfilling and enriching, and that brings you joy and happiness. If you are not feeling those things, it just might be time to venture forth on your own.
• Have you stayed too long? Do you have a sense of “been there, done that” with your work? Are you bored? If the answers to these questions are “yes”, you may have outgrown your job. That is okay. It just means it is time to look at different opportunities.

Next, create a path for your departure. What steps do you need to take to be ready for what comes next? These steps may include additional training, skills development, due diligence on a potential entrepreneurial venture, resume updating, or additional networking.

It is likely that these steps can be taken while you are still employed. Taking the time to acquire what you need in the way of skills, information, advice, and capital while still earning a paycheck is a smart idea. It allows you to explore and, perhaps, change that path before making a career leap.

Finances are a major consideration for anyone looking to leave the corporate life. You need to consider how you will support your lifestyle and pay the bills, while at the same time determining how you will cover the costs of a potential start-up venture.

You need to make a budget, a comprehensive business plan, and do the math. Are there living expenses that can be cut, at least temporarily, once you leave? Do you have enough savings to support you and your loved ones? Is there a spouse or partner who will continue to have health insurance and other benefits to provide the security and peace of mind you need, especially when starting a new business?

Overcoming Obstacles

When you choose to leave a job, you are inevitably going to face several obstacles. Knowing what these obstacles are and understanding how to overcome them are important steps as you prepare. Here are three of the biggest obstacles and what to do about them.

1. Financial Reliability. To be honest, there is one considerable advantage to working for a corporation. You know you will be getting a steady, reliable paycheck. You can count on this income to pay your living expenses, entertain yourself, and put away savings for rainy day emergencies or your entrepreneurial dream. That is one of the biggest reasons to do the planning and due diligence while you are still employed. You may also be able to start your own business, at least part-time, while you are still working a full-time job. While this can be onerous, it will provide you with confidence and financial security.
2. Increasing Debt. Consumer debt such as credit cards, car payments, and student loans can be, well, consuming as you consider what to do when you leave the corporate bubble. Before you leave, you should do everything in your power to reduce or eliminate these debts from your portfolio. Not only does this lessen the anxiety and strain of a new venture, but it also takes the pressure off of your initial income needs when you go out on your own.
3. The Skeptics. Friends, family members, and coworkers may look askew, frown, or vocally criticize your choice. Skeptics abound, especially among those who are more risk-averse. This is a natural reaction and it is a good idea to not take these skeptics’ words too personally. The best way to overcome these skeptics is to provide them with information about the reasons you are leaving the corporate world, the thoughtfulness you have put into that decision, the work you have done to determine what comes next, and how you will achieve the success you are seeking in the next phase of your life.

What Lies Ahead

Congratulations! You have answered the questions, created the path, considered your options, done your homework, and decided to make a change. Now, what?

Now, the opportunities are limitless. You are no longer bound by the workaday rigors of a corporate existence. You can create your own adventure. What awaits is extraordinary. Consider the benefits of starting your own business:

• You are in charge of your own destiny. As an entrepreneur, you control the fate of your enterprise. You get to make the decisions, create the rules, establish the values, and reap the rewards related to your business. You are squarely in the driver’s seat and making your own decisions.
• You select the staff. When you create your own business, you can bring on the employees, advisors, investors, and consultants who share your values and vision. You can build a team of people who will work with you to achieve the vision you set forth. While that is a heady responsibility, it is also an extraordinary opportunity.
• You create the balance. A lot is said today about work/life balance. As the owner, you have the chance to set the tone and expectations that give you and your team the balance you believe is right.
• You can follow your passion. With your own business, you can realize the dreams you have had for years and help bring to life the idea that has been percolating in your head.
• You can work with the clients and customers you want. As a business owner, you can work in the markets, industries, and company you want. You can connect with the kinds of people you want to work with, on your terms, and help serve their needs with your products or services.
• You have pride of ownership. At the end of the day, you will leave a legacy behind that will be a testament to the hard work you put into the effort.

There are hundreds of restaurant concepts in America, but the three that seem to be on the top of everyone’s list to franchise are Chipotle, White Castle and Chick-fil-a. A day doesn’t go by that I don’t get a request to help secure a franchise with one of these three concepts.

Unfortunately, all three are dead ends when it comes to franchising. To start off, neither Chipotle or White Castle sell franchises. All of their stores are owned by the parent company. But, hey, there’s still Chick-fil-a, right. Probably not.

Below is a link to an article, aptly titled:

Becoming a Chick-fil-a Franchisee Is Almost Impossible

If you are interested in someday becoming a Chick-fil-a owner, please read the whole article including how Chick-fil-a defines “ownership.”

But don’t worry, there are hundreds of other great restaurant franchises to choose from. Why limit your options?

Harbour Capital, a franchise finance company has published an excellent article entitled:

The Guide To Acquiring A Franchise.

If you are considering purchasing a Franchise, I advise you to read the entire article, but here are the bullet points:

Have a Business Plan

Know Your Financial Capabilities

Acquire Adequate Financing

Select the Franchise(s) that suit you best

Thoroughly Research the Franchise(s) (including review of the FDD) that you have Chosen to Pursue

Talk to Other Franchisees

Franchising is a process, and if you’ve never been through it before, it can be more of a gauntlet.

A certified Franchise Broker can use his or her expertise and experience to move you through that process, explaining the language of franchising, connecting you to the right people and, of course, helping you to find financing sources.

However, one of the most important services a Franchise Broker can offer is in helping you to find the Franchise opportunity that fits your goals, your life style and your budget.

The first paragraph of the article states:

“Picking which franchise concept suits you best is the first major hurdle that must be overcome”

There are an estimated 4000 franchises available in the United States. A good Franchise Broker, using the information that you provide, can eliminate those Franchises that simply don’t fit you or your criteria and focus you in on those that do. My personal experience is that about 75% of those who start their search with a specific Franchise in mind, end up choosing something different.

Don’t start your path to Franchise ownership without a map. Select a knowledgeable and experienced broker and go straight to your goal.

FEB 15, 2017 | Author Larry Carnell CBI, CFE, CFB
When you think back to the impression you’ve been given your whole lifetime, you can probably tie the word “job” to security. Always accepting the notion that the longer you stay somewhere, the better off you will be. Some of you reading this may even have upheld that notion and are now at a crossroads; you’ve severed ties with a longstanding employer and you’re well into your working years.

Whether you have experienced it already or perhaps indirectly, the presence of ageism in the workplace exists. Employers want talent and experience, but not too much experience.

Here are the disturbing figures:

• People past the age of 45 that are looking for a new job can often wait as much as twice as long -or longer – to find a job versus younger age groups

• There are often 3 people applying for every new job

• Length of replacement jobs are often shorter than previously held

• Peak incomes are declining (Payscale.com)

• Peak income for men has dropped to 48

• Peak income for women is now 39

• Outsourcing has become an effective tool in cutting higher operational and managerial expenses. Why hire an expensive employee when you can outsource those services and only use and pay for it when needed?

• One would think that knowledge and experience is extremely valuable and that those years of experience would be worth acquiring and keeping, but the statistics show this is not likely the case for most employers.

What Can You Do?

In a situation where you’re faced with jumping back into the pool of employment candidacy, you can do one of the following:

1. Re-train or re-invent yourself (ie: go back to school, take a certification course, etc.) but this can often be difficult and costly.

2. Wait it out and continue the application and interview process hoping that something will come along that meets both the employer’s needs and yours. This could take in some cases up to- or more than – a year.

3. Start your own business or purchase a franchise.

I’ll share with you a recent story of my own: While my wife stopped into a Walmart for a few items, I found myself making small talk with a very friendly and energetic gentleman who worked in the store as a greeter. He disclosed to me that he was once the Vice President of Sales for a company where he had worked for 5 years before being “laid off” at the age of 57. He was then faced with unemployment for 3 years before agreeing to accept the job at Walmart. He felt he had no choice due to depleting savings and eroding retirement funds. He held onto the hope that someone would come along and hire him due to his past accomplishments and skillsets. After “50 – 100” applications and interviews, no such luck. There was no doubt this gentleman had skills, maturity, experience and other desirable attributes, yet no one seemed to want them – or him. Those very attributes could be extremely effective in owning a business of his own. I then asked this gentleman his thoughts on owning his own business, but he very quickly dismissed this idea. Why?

The Perception:

Owning a business is often seen as risky, scary and time consuming. But, so is job searching in a market that is bypassing the experience you are bringing to the metaphorical table. What if you could be in control of your own destiny? What if you could provide yourself with long-term security? What if you could achieve a superior income stream as well as increased equity and wealth protection? Business ownership is one of the few areas where one can achieve these qualities; often not provided with many jobs.

Back to the risk factor for a moment. One of the most difficult things for many to understand is that it’s often virtually impossible to eliminate risk unless one also eliminates opportunity. For many approaching or passing the age of 45, the risk of business ownership may be less than the risk of job insecurity, declining lengths of employment, declining pay scales and other factors.

How Can YOU Make The Dream of Business Ownership Possible?

It is a common misconception that the cost of owning a business is well, expensive. Not true! One of the more common methods of business ownership that eliminates a lot of the typical costs is franchising. Owning a franchise actually causes the cost of business ownership to decrease in many cases. There’s often less risk associated, as well.

Consider the fact that you are ultimately using others’ trial and error to maximize your potential for success. The average total cost of entry level franchises purchased (those typically less than $250,000) have decreased almost 30% over the last 5-10 years! Additionally, many of the newer and more high- demand concepts available enable people to operate out of their homes and even provide products and or services across the country, which was unheard of decades ago.

Another win? There are now a variety of attractive programs to help you fund your business including an innovative program that allows one to use their retirement funds tax, penalty and debt free. Benetrends is the original pioneer of this funding method called Roll Overs for Business Start-Ups or “ROBS”. They are also partnered with some of the country’s leading brands in franchises and can offer you expert counsel in making what once may have seemed like an expensive dream, an inexpensive and successful reality.

By Joel Libava

Feb. 15, 2017

There are certain promises you get when you purchase a franchise business. Some of them come to you by way of the marketing and advertising of a franchise and its model. Some of them come from your franchise development representative.

You: “So, what exactly am I getting for all the money I’m giving you?

Franchise Representative: “Our name…our brand if you will, our technology, our proven marketing plans and advertising materials, a detailed operating manual, and of course, terrific support.”

There’s that word again; support. Let’s talk about it.

Moving Parts

There are a lot of moving parts in a franchise business. At times, these “parts” need to be fixed or improved. And, it all starts with operations.

Operational Support

According to an article on the International Franchise Association (IFA) website, “The most effective and efficient franchisee support programs are formulated, executed and evolve based on two important factors: the franchisor’s corporate culture and the structure of the support program itself. “

The operations department at headquarters is focused on the entire franchise operation…the A-Z’s of running the business. Operations people are involved in several facets of the franchise business including franchisee training, branding, advertising, best practices, benchmarking and more. You’ll have a lot of interaction with the operations department; they’re the lifeblood of the franchise organization. I’m going to focus on three specific support items.

Technology

Franchise businesses today depend on technology-good technology, to keep things running efficiently and profitably. Sometimes, technology breaks, and when it does, the technology team (which is usually an arm of the franchise operations department) at franchise headquarters, generally has the ability to jump-in and fix issues.

Technology problems can and do affect the entire organization. If franchisees are experiencing issues, especially ones that directly affect revenue, the franchisor suffers, too.

Tip: When conducting your research, make sure you ask existing franchisees if they’ve ever experienced problems with technology specifically supplied by the franchisor. Then ask them how long it took to get their issues resolved by the support team.

Marketing

As a franchisee, you need to have as many opportunities as possible to sell your products and/or services. Marketing creates those opportunities. And, you’re paying* your franchisor to help market your business.

*Most franchisees pay into a marketing fund. The amount paid is usually a percentage (2-3% usually) of revenue. If your franchise business is generating $400,000 in annual revenue, your franchisor would receive $8,000 – $12,000 a year for marketing.

One of the attractions of franchise ownership is the fact that you don’t have to figure out the marketing aspect of the business. That’s what the marketing department is for. Ask franchisees how good the marketing is. Then ask them what kind of support specifically they get from the marketing team at headquarters.

Field Support

Most franchisors employ field representatives. Their job is to visit and assist franchisees at their locations.

In addition to their problem-solving role, field reps are often tasked with sharing and explaining corporate initiatives-especially new ones. They often help the franchisor ensure that the franchisees are indeed following the business system they purchased and legally agreed to follow.

A good field representative can be a real blessing for a franchisee. Reps can find things franchisees are doing incorrectly or need improving, and help them get back on track. Today’s field reps understand that the franchisees have put their own money and sweat into their businesses and that they really want to succeed.

Great support from franchise headquarters can often spell the difference between franchisee profitability and mediocre franchisee financial performance or worse and franchisee dissatisfaction.

Remember, if the franchisees do well, the franchisor does well.

Ask a lot of support-related questions as you do your research. You’ll be glad you did.

In a LinkedIn article by Dr. Travis Bradberry, he analyzes the work of Angela Lee Duckworth on the attributes of successful people. Duckworth was able to distill her conclusions down to a single word: Grit.

What is “Grit?”

“ “Grit” is that “extra something” that separates the most successful people from the rest. It is the passion, perseverance, and stamina that we must channel in order to stick with our dreams until they become reality.”

The article is well worth a thorough reading by anyone looking to start a business and you can access it HERE.

Do you have Grit?

Franchise Depot

By Nic Clark

Franchising is often underestimated as a form of entrepreneurship, since franchisees are licensing the name and intellectual property of another company. Modern-day business owners frequently tout the benefits and glamour of owning and operating your own business, but what often goes unsaid is just how difficult it can be to start a new business. Those who
don’t want to (or don’t know how to) build their own supply chains, create their own management policies, build a customer base, and design their own products, should consider whether a franchise is right for them.

The appealing part of owning a franchise is that it represents the closest alternative to owning your own business, with the added benefits of built-in brand name recognition and the support of an established organization. Franchise ownership is where most budding entrepreneurs begin successful careers in business ownership.

When considering whether to go down the path of franchise ownership, there are a few things to keep in mind in order to be prepared to meet the challenges that come with franchise ownership. Asking yourself the following questions will help you make the right set of decisions when determining which franchise is right for you.

1) Can I Meet the Financial Requirements?

Each company sets different financial requirements for their franchisees. It is up to you to ensure that you make the financial cutoff for the business that you want to own. The “cutoff” is the amount of money a franchise requires a potential franchisee to possess in liquid assets and overall net worth before awarding a franchise. This amount varies dramatically between different franchises and in different industries. For example, a restaurant requires a franchisee have a vastly higher net worth (in the low millions) than, say, a home-based janitorial service.

Liquid assets are especially important when considering a franchise, because most businesses will require initial payment for the cost of licensing, leasing, inventory, and sometimes labor.

Furthermore, franchisees are required to pay a royalty, either on a monthly or annual basis, to the franchisor, regardless of the profitability of their individual franchise units. This could prove costly if the franchisee hasn’t done the necessary work on building the business and growing the clientele. Furthermore, many franchisees are required to sign a contract
mandating that they own the franchise for a certain period of time (e.g. five years), and exiting before it terminates can carry a hefty fine.

These financial caveats shouldn’t deter interested potential franchisees, but instead inspire them to do their research and be sure they can easily fulfill the financial requirements of the franchise in the long-term.

2 ) Do I have the skills and knowledge necessary to make a franchise work?

Not all industries require the same set of skills and experience. Working “on the business,” and “working in the business” require different skill sets, but many times franchise owners are required to solve customer problems or even cover an absent employee’s shift. For example, if you own a Jiffy Lube franchise but you don’t know the first thing about working with cars,
then you’ll have a hard time making decisions that are beneficial to the specific nature of your business. Imagine working for a boss who never allocated the right amount of money to purchase certain parts and machinery. This would reduce the overall quality of service,
harming the franchise’s ability to turn a profit.

Keep in mind, however, that you also don’t necessarily want to acquire a franchise in an industry that is too close to your area of expertise or interest. For instance, someone with amazing culinary skills and a fond interest in cooking might not be the best person to become a restaurant franchisee. Why? Chances are, a chef with a true love and talent for cooking might find it difficult to maintain the strict policies and procedures set forth by the franchise.

Also, once you purchase a franchise in any industry, you aren’t in the business of the industry itself; you are in the franchise industry.

3) What is my end goal?

Owning a franchise means you own your own business, yet you are still under the auspices of a larger corporation that guides and directs what you do in your own store. For some people this is very appealing. Essentially, franchisees are in business for themselves, but not by
themselves. They receive a kind of stability and predictability that reduces the risks associated with owning a business. This same quality can also be a huge deterrent to people who crave independence and autonomy, so it is important to be sure you can operate under the franchisor’s rules and regulations. Some franchises allow the franchisee more discretion in this
area than others.

In other words, in owning a franchise, you trade a portion of potential earnings and independence for structure, predictability, and a built-in customer base. What you want out of owning a business will determine the best route for you. If you desire more or less freedom in how you run your store, it makes sense to do exhaustive research into their culture and
approach before you sign that contract.

If you have ever considered purchasing a small business, especially a franchise business, there is no better time than now!

“Optimism among America’s small businesses soared in December by the most since 1980 as expectations about the economy’s prospects improved dramatically in the aftermath of the presidential election.”

Link:

U.S. Small-Business Optimism Index Surges by Most Since 1980