10 Franchises You Can Afford.We offer a selection of profitable ventures that are within your reach FOR THE PAST FIVE YEARS, SHELTON Shelton, city (1990 pop. 35,418), Fairfield co., SW Conn., on the Housatonic River opposite Derby; settled 1697, set off from Stratford 1789, inc. as a city 1915. Metal products, furniture, and electronic equipment are among the city's manufactures. JEFFERSON Jefferson, uninc. city (1990 pop. 25,782), Fairfax co., N Va. It is a residential suburb of Washington, D.C. HAS BEEN running things as the top gun in his computer networking
Computer networking is the engineering discipline concerned with communication between computer systems or devices. firm. In the early stages, the company was based on his concept, marketing plan, intuition intuition, in philosophy, way of knowing directly; immediate apprehension. The Greeks understood intuition to be the grasp of universal principles by the intelligence (nous), as distinguished from the fleeting impressions of the senses. , experience, and capital. Entrepreneurship en·tre·pre·neur n. A person who organizes, operates, and assumes the risk for a business venture. [French, from Old French, from entreprendre, to undertake; see enterprise. enabled him to create reasonable equity and value in his own business rather than in someone else's company, and that was an accomplishment. On the other hand, Jefferson's independence proved to be a limitation when it came time for him to expand his business. About two years ago, his company began providing computer training. "We were mainly hardware and software people," he admits, "and many of our customers wanted training. But we just thought we weren't were·n't Contraction of were not. weren't were not as good as we could be." As a solution, in March 1999, Jefferson used $20,000 of his personal savings to purchase a franchise from The Fourth R. The computer education firm provided Jefferson with the assistance and training he needed to expand into a new area. Jefferson, whose New York-based Fourth g franchise employs five people, says the franchisor's support system and access to strategies for running a company helped him build a successful business. He expects his franchise to net about $500,000 this year. Franchising may be for you as well. Buying a franchise gives an entrepreneur entrepreneur (än'trəprənûr`) [Fr.,=one who undertakes], person who assumes the organization, management, and risks of a business enterprise. the right to use the franchise's name, trademark, and product. Franchises also offer tried-and-true business and marketing formulas, as well as a support system for new franchisees. "When you join a franchise system, you join a system that has already perfected the business model," says Don DeBolt, president of the International Franchising Association (IFA Immunofluorescent assay (IFA) A blood test sometimes used to confirm ELISA results instead of using the Western blotting. In an IFA test, HIV antigen is mixed with a fluorescent compound and then with a sample of the patient's blood. ). "By the time you get to the system, and you acquire the rights to operate that franchise, you not only have a very sophisticated training system and ongoing support for your franchise business, you also have a wealth of information and support from your peers, who are already operating franchises in that system." There are franchise opportunities in nearly 75 industries, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. IFA, which is based in Washington Washington, town, England Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. , D.C. Generating $1 trillion One thousand times one billion, which is 1, followed by 12 zeros, or 10 to the 12th power. See space/time. (mathematics) trillion - In Britain, France, and Germany, 10^18 or a million cubed. In the USA and Canada, 10^12. in retail sales in 1999, franchises employ more than 8 million Americans. Although most franchises are brick-and-mortar brick-and-mor·tar adj. Located or serving consumers in a physical facility as distinct from providing remote, especially online, services: brick-and-mortar classrooms; a brick-and-mortar bookstore. , storefront, or mobile operations, many enable entrepreneurs to work from home. Some of the hottest industries in franchising--residential cleaning services, elder care, lawn care--reflect the trends of the marketplace overall. "Service-oriented Different ideas of service-orientation are found in different domains.
Franchisees like Willie T. Rollins are able to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. filling a service-oriented niche. Although Rollins had already run his own financially lucrative landscape maintenance company for 14 years, six years ago he decided to purchase a franchise with $15,000 of his personal savings. Rollins credits his franchisor with helping him build every area of his company. He says U.S. Lawns assisted his Florida-based franchise in the purchase of the right equipment, administration, the training of employees, and instruction in how to bid for work. "They have a lot of good tools to use," says Rollins, whose clients include the Broward County School Board, the city of Miramar, and a number of office complexes and condominiums in the Miramar and Fort Lauderdale Fort Lauderdale (lô`dərdāl), residential, commercial, and resort city (1990 pop. 149,377), seat of Broward co., SE Fla., on the Atlantic coast; settled around a fort built (c.1837) in the Seminole War, inc. 1911. area. Last year, his company grossed $1.3 million, a figure that includes the gross sales Gross Sales A measure of overall sales that isn't adjusted for customer discounts or returns, calculated simply by adding all sales invoices, and not including operating expenses, cost of goods sold, payment of taxes, or any other charge. from his existing landscape business. "Before we purchased the franchise," explains Rollins, "the highest sales we had were about $700,000. With the franchise, we were able to move beyond that." In recent years, one of the most significant growth areas for franchisees has lain in the purchase of additional franchises. Rollins, who currently employs more than 30 people, purchased a second U.S. Lawns franchise in Fort Lauderdale for $30,000 this past May. The rise in the cost of the franchise shows the vast increase in the value of a U.S. Lawns business. Jefferson also recently purchased a second The Fourth R franchise with a partner in Dallas. "That's a great testimonial to their commitment to their franchisor," says DeBolt, "that they're willing to invest more money in the concept. The multiunit owner of a franchise is rapidly becoming the most significant part of our wealthier middle class." And most franchises are within your financial reach. DeBolt says there are growing and successful franchises that can be purchased for less than $100,000. In fact, the majority of franchises are under $1 million. Typically, franchises in the automotive, lodging Lodging or holiday accommodation is a type of accommodation. People who travel and stay away from home for more than a day need lodging mainly for sleeping. Other purposes are safety, shelter from cold and rain, having a place to store luggage and being able to take a , and restaurant industries cost more than $1 million. However, since most franchisors assist with financing through either internal financing internal financing The financing of asset purchases with funds generated in the usual course of operations rather than funds that are borrowed or raised from the issuance of stock. or linkages with outside financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. or institutions, more expensive franchises may also be a viable option. This year, BLACK ENTERPRISE'S annual list of franchises includes businesses in the residential cleaning, maintenance, computer, and education industries. Based on a national survey of franchisors conducted by BE Research, the list provides an overview of franchises that have franchise fees and start-up Start-up The earliest stage of a new business venture. costs of less than $70,000 and that already have black owners among their franchisees. We've also included contact information, a description of the business, the average 1999 sales for the franchisor's units, and other information you should consider when making your decision. How can you identify a winning franchise? Heed heed v. heed·ed, heed·ing, heeds v.tr. To pay attention to; listen to and consider: "He did not heed my gibes, and chattered on" Sean O'Faolain. the advice of experts and franchisees. * Do your homework. There's no shortcut (1) In Windows, a shortcut is an icon that points to a program or data file. Shortcuts can be placed on the desktop or stored in other folders, and double clicking a shortcut is the same as double clicking the original file. for research. Review franchise options that fit your needs and interests. The Franchise Opportunities Guide ($23), available through the IFA, provides information on more than 2,000 franchise concepts. To order, call 800-543-1038 or visit www.franchise.org and click on "franchise opportunities mall" to view options. You can also refer to Bond's Minority Franchise Guide ($19.95) for a selection of business opportunities. * Be realistic about your expectations. Franchisees work long hours, face setbacks, and meet some of the same challenges independently owned businesses do. Although statistics show that franchises have a greater success rate than independent new businesses, your personal success will depend on many factors: the climate of the marketplace, personal aptitude, adequate financing, and the availability of other resources. According to DeBolt, "Becoming a franchisee reduces the risks of operating your own business substantially, but it doesn't eliminate them." * Take a personal inventory of your goals and skills. Examine your interests and how you can parlay An open programming interface (API) to a service provider's network (the network operator), developed by the Parlay Group (www.parlay.org). By enabling the customer's application to talk directly to the network, it allows the end user to have greater access to network information as well them into a business. "I believed that children, including my daughter, should have hands-on exposure to science at an early age," says Cornelia Ryan, owner of a Little Scientists franchise in Richmond, Virginia Richmond IPA: [ɹɯʒmɐnɖ] is the capital of the Commonwealth of Virginia, in the United States. . The franchise, which offers science enrichment enrichment Food industry The addition of vitamins or minerals to a food–eg, wheat, which may have been lost during processing. See White flour; Cf Whole grains. programs for preschool and elementary school elementary school: see school. students, seemed like the perfect venture. Ryan used her personal savings to purchase her franchise last July for $20,000. Her company officially started operation in October. She expects her franchise to gross $60,000 this year. * Have enough capital. "Yes, the initial start-up money is low," Jefferson says, "but you should come to the table with additional capital to make it work." Jefferson's total investment in his franchise was nearly $70,000. It's important to make sure you have enough capital to purchase the franchise, as well as funds to cover additional start-up costs and at least six months' worth of operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. . Ryan agrees. "If I had used that capital to borrow more money," she says, "I would have had extra money for marketing and general operating costs operating costs npl → gastos mpl operacionales . I would have had a cushion Cushion In the context of project financing, the extra amount of net cash flow remaining after expected debt service. cushion See call protection. ." As a new business, you may experience uneven cash flows and unforeseen problems that will require additional money. Any one of these surprises could deplete de·plete v. 1. To use up something, such as a nutrient. 2. To empty something out, as the body of electrolytes. your reserves even though you still have to pay rent, salaries, insurance, and other fixed expenses. To safeguard your enterprise from a financial disaster, secure adequate backup reserves. These could be in the form of savings, bank loans, or support from relatives. * Contact the franchise. Once you've narrowed your search, give the franchisor a call. Ask them to send you a complete packet on their organization. If the packet sparks Sparks, city (1990 pop. 53,367), Washoe co., W Nev., just E of Reno; inc. 1905. The Southern Pacific RR was the major employer until the dieselization of railroad engines forced the closing (1957) of the railroad shops there. your interest, your next step should be to visit the franchisor's headquarters. According to DeBolt, that visit will help you gauge whether you are a good fit with the organization. It will also help you build relationships with individuals in the home office. * Read the fine print. Take a close look at the profile of your prospective franchisor and ask yourself these questions: Does the product demonstrate a clear advantage over the competition? Has the standardized standardized pertaining to data that have been submitted to standardization procedures. standardized morbidity rate see morbidity rate. standardized mortality rate see mortality rate. system stood the test of time? Does the franchisor provide exceptional franchisee support? Do the management's objectives seem realistic in the current climate? Does the franchisor have a strong commitment to its franchisees over the long term? The answers to these questions and others could save you time and money. * Call other franchisees. DeBolt suggests calling a minimum of 25 current and/or past franchisees with your chosen franchisor. Discuss their experience and ask them about the pros and cons pros and cons Noun, pl the advantages and disadvantages of a situation [Latin pro for + con(tra) against] of becoming a franchisee. * Be prepared to negotiate. Contrary to what the franchisor tells you, a number of variables are negotiable NEGOTIABLE. That which is capable of being transferred by assignment; a thing, the title to which may be transferred by a sale and indorsement or delivery. 2. . To get the best deal, you'll need a thorough understanding of the industry and franchising agreement as well as access to an experienced professional (such as a lawyer, accountant, or franchise consultant who has a proven track record in negotiating franchisor agreements). Some of the things that may be up for bargaining are payment terms, the amount of the franchise fee, territories, cancellation rights, and other terms. According to Bond's Minority Franchise Guide, "If the franchisor truly wants you as a franchisee, it may be willing to make concessions not available to the next applicant." 10 Franchises you can afford
Company Location
West Sanitation Services 3882 Del Amo Blvd., Suite 602
Torrence, CA 90503
310-793-4242
OpenWorks 2777 East Comelhnck Rd., Suite 350
Phoenix, AZ 85016
800-777-6736
Miracle Method Refinishing 4239 N. Nevada Ave., #115
Colorado Springs, CO 80907
800-444-8827
Molly Maid Inc. 1340 Eisenhower Place
Ann Arbor, MI 48108
800-665-5962
U.S. Lawns Inc. 4777 Old Winter Garden Rd.
Orlando, FL 32811
407-522-1630
ECW Corp. 10132 Colvin Run Rd.
d/b/a Computer Tots and Great Falls, VA 22068
Computer Explorers 703-759-2558
The Fourth R 1715 Market St., Suite 103
Kirkland, WA 98033
800-821-8653
Happy & Healthy Products Inc. 1600 S. Dixie Hwy., Suite 200
Boca Raton, FL 33432
561-367-0739
The HomeTeam 6355 E. Kemper Rd., Suite 250
Inspection Service Inc. Cincinnati, OH 45241
800-598-5297
Merry Maids 860 Ridge Lake Blvd.
Memphis, TN 38120
800-798-8000
Black-
Owned
Company Type Units
West Sanitation Services Restroom Air Freshner 8
and Deodorizing Dispenser
Service
OpenWorks Facility Cleaning 88
and Maintenance
Miracle Method Refinishing Tub, Tile, and Counter 10
Resourcing
Molly Maid Inc. Residential Cleaning 11
U.S. Lawns Inc. Commercial Landscape 6
Maintenance
ECW Corp. Computer Education 9
d/b/a Computer Tots and for Children
Computer Explorers
The Fourth R Computer Education 6
Happy & Healthy Products Inc. Wholesale Retail 3
The HomeTeam Home Inspection 3
Inspection Service Inc.
Merry Maids Residential Cleaning 14
Domestic
Franchise
Company Units Fee
West Sanitation Services 75 $2,000
OpenWorks 382 $14,000+(*)
Miracle Method Refinishing 101 $16,500
Molly Maid Inc. 280 $6,000
U.S. Lawns Inc. 73 $20,000
ECW Corp. 109 $29,900
d/b/a Computer Tots and
Computer Explorers
The Fourth R 164 $16,000
Happy & Healthy Products Inc. 115 $17,900-
$24,000
The HomeTeam 314 $10,900-
Inspection Service Inc. $29,900
Merry Maids 851 24K-Full
20K-Mid
$16K-Small([dagger])
$1,999
Start-Up Average
Company Costs Sales/Units
West Sanitation Services $2,800 $49,056
OpenWorks $15,000 $60,000
Miracle Method Refinishing $20,000 $125,000
Molly Maid Inc. $50,000- $361,706
$60,000
U.S. Lawns Inc. $49,000- $700,000
$54,000
ECW Corp. $43,800 $85,939
d/b/a Computer Tots and
Computer Explorers
The Fourth R $26,000+ N/A
Happy & Healthy Products Inc. $22,934- N/A
$53,995
The HomeTeam $18,450- $36,025
Inspection Service Inc. $45,550
Merry Maids $32,500- N/A
$49,500
(*) The fee is determined by the monthly volume of customers. (**) Start-up costs depend on equipment franchisee needs to purchase. ([dagger]) Franchise fee is based on market potential of three sizes. Start-up costs include franchise fee and opening business costs. Source: B.E. RESEARCH |
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