Are you a corporate executive who’s recently been laid off (or is afraid you’re going to be laid off)? Looking for a new job isn’t your only option for earning an income. More and more former corporate executives are turning to franchising as a way to start their own businesses. And a growing number of franchise companies are actively recruiting ex-execs as franchisees.
Why do ex-execs make good franchisees? Here are a few reasons:
- No matter what type of franchise you buy, business management and sales skills are the key to building the business. If you buy a janitorial franchise, for instance, you don’t necessarily need to know how to clean toilets — you can hire people to do that. What you do need to know is how to hire the right people, manage them, get new clients, manage the business’s finances, and so on. These are skills former execs typically possess.
- Being a franchisee requires working within a system and following rules that have been laid out for you by someone else. True maverick entrepreneurs often have difficulty with this, but former executives are used to working this way and actually thrive within a system.
- As a former executive, you are more likely than most people to have the financial resources needed to buy a franchise. For example, you may have investments, a 401(k) plan, personal savings, collections or “toys” such as a boat you can sell, or a severance package you can tap into.
But despite these advantages, it’s not always smooth sailing when former execs become franchisees. Here are a few reasons why:
- All the tasks that were once handled by support staff — such as mailing packages, handling accounting, or taking out the trash — now need to be handled by you. Although you will have the support of the franchisor to turn to for some of this assistance, you will still have to be much more hands-on than you ever were as a corporate executive with one specific area of responsibility.
- The time commitment required as a franchisee is much greater than that of a corporate executive. True, in the corporate world you may have worked long hours, nights and weekends — but at some point, you could go home and “turn it off.” When you’re the boss, the buck stops with you. That means that if your restaurant location has a burst pipe and floods at 3 a.m. on a Sunday, you’re the one who will have to deal with it.
- It’s true that as a franchisee you will be following the franchise system’s rules and procedures. However, you still need an entrepreneurial spirit to make your business succeed. Franchisors don’t want franchisees who wait for everything to be handed to them — they want franchisees who can take ownership of the business and take the initiative to make it grow. If you don’t have that spirit, you aren’t cut out to be a franchisee.
As with everything else about franchising, it all boils down to you. Only you can assess your skills, experience and temperament to decide if you have what it takes to succeed as a franchisee.
Karen Axelton is Chief Content Officer of GrowBiz Media (www.growbizmedia.com), a content and consulting company that provides information, advice, and resources to help entrepreneurs start and grow their businesses.