Personal Development for Smart People Forums - View Single Post

ahimel · 01-28-2007, 04:53 AM

I'd say it depends on what your goals are.

Is your goal to do something you enjoy? To have cashflow from a business you can ignore? To learn more about business/business building?

I've thought about franchising several times, and have rejected it because I'm most excited about building the business. I want to see if I actually can create an entirely new entity that can go on without me.

But if you just want money without effort, franchises have the best chances of succeeding. Not that buying and setting up a franchise isn't effort, but you get help, and if you do it right you can ignore it thereafter. When you build your own business it's more like 24/7 emergencies for 3 years straight with no guarantee that you'll even have a positive net worth at the end. So I guess many franchises are just as much effort, but far less stress.

But if you need money quickly, franchises are not the way to go. They have huge set-up fees, and take a lot of your up-front revenue. It could be a little while before you start to see a profit -- a couple months at minimum, and a couple years is not out of the question. Whereas my roommate built a computer-repair "business" that was profitable on the first day -- he spent $50 on a hard drive, and got $150 for installing it in a computer.

If your intention is to buy a job rather than a passive-income generator, then you have to consider your personality type. If you really like (for example) fixing motorcycles, but detest advertising and paperwork, then franchises are definitly the way to go. It won't eliminate the need for accounting, but it will make accounting as brainless and painless as possible.

But if you're the sort of person considering starting your own business instead of just getting a job at (for example) Bob's Motorcyle Repair Shed, there's a good chance that you don't like having people tell you what to do. In which case a franchise is a terrible idea -- they're telling you what to do all the time.

So what do you want out of a business? That will determine whether franchising is for you.

(I didn't vote in the poll, since I have no personal experience with franchising.)

01-28-2007, 04:53 AM	#8 (permalink)
ahimel Senior Member Join Date: Nov 2006 Location: Boulder, Colorado Posts: 398	I'd say it depends on what your goals are. Is your goal to do something you enjoy? To have cashflow from a business you can ignore? To learn more about business/business building? I've thought about franchising several times, and have rejected it because I'm most excited about building the business. I want to see if I actually can create an entirely new entity that can go on without me. But if you just want money without effort, franchises have the best chances of succeeding. Not that buying and setting up a franchise isn't effort, but you get help, and if you do it right you can ignore it thereafter. When you build your own business it's more like 24/7 emergencies for 3 years straight with no guarantee that you'll even have a positive net worth at the end. So I guess many franchises are just as much effort, but far less stress. But if you need money quickly, franchises are not the way to go. They have huge set-up fees, and take a lot of your up-front revenue. It could be a little while before you start to see a profit -- a couple months at minimum, and a couple years is not out of the question. Whereas my roommate built a computer-repair "business" that was profitable on the first day -- he spent $50 on a hard drive, and got $150 for installing it in a computer. If your intention is to buy a job rather than a passive-income generator, then you have to consider your personality type. If you really like (for example) fixing motorcycles, but detest advertising and paperwork, then franchises are definitly the way to go. It won't eliminate the need for accounting, but it will make accounting as brainless and painless as possible. But if you're the sort of person considering starting your own business instead of just getting a job at (for example) Bob's Motorcyle Repair Shed, there's a good chance that you don't like having people tell you what to do. In which case a franchise is a terrible idea -- they're telling you what to do all the time. So what do you want out of a business? That will determine whether franchising is for you. (I didn't vote in the poll, since I have no personal experience with franchising.)