How you can make $100,000 a year from home; 10 home-based franchises that fit your pocketbook--and profit motive. (Franchise Opportunities).B.J. HARRISON DOESN'T MIND IF HE'S CALLED A COMPUTER GEEK--JUST DON'T CALL HIM A NERD A person typically thought of as introspective, antisocial and one who likes technical work. The origin of the term is most often attributed to an angry little man in Dr. Seuss's book "If I Ran the Zoo" in 1950. How the word evolved into the mainstream is unclear. . "Nerds do it for free, geeks get paid," explains the 36-year-old owner of a Geeks On Call home-based franchise. Harrison provides PC and computer network maintenance, upgrades, training, and consulting to computer users in their homes or businesses. And he is getting paid. Launched in July 2001, his one-man franchise grossed $34,000 for the remainder of that year and has generated more than $47,000 in the first six months of 2002--some $81,000 in the last 12 months. Not bad for someone who averages a 24- to 28-hour workweek. However, programming this new venture was no small feat for the former information technology support staffer with Internosis, a technology-consulting firm based in Arlington, Virginia. Start-up costs totaled $55,000, which included a $15,000 franchise fee, $20,000 for a vehicle, $9,000 in up-front advertising expenses, and another $11,000 for working capital and inventory. Fortunately, Harrison's out-of-pocket expenses out-of-pocket expenses n. moneys paid directly for necessary items by a contractor, trustee, executor, administrator or any person responsible to cover expenses not detailed by agreement. were only $5,800, financing most of the business through a $58,000 loan with the Small Business Administration. Now, Harrison revels Not to be confused with Revel. A revel is a type of celebration or festival, involving dancing, costumes, and general merrymaking. John Langstaff founded the 'Revels not only in the fact that he's his own boss but he has also gained true occupational independence. What attracted him to operating his business from home, he concedes, was "the freedom to be able to fix a schedule to do what I need to do and what I want to do." Harrison represents a growing breed of franchisees who have made the decision to hang their shingles shingles: see herpes zoster. shingles or herpes zoster Acute viral skin and nerve infection. Groups of small blisters appear along certain nerve segments, most often on the back, sometimes after a dull ache at the site; pain becomes from home. 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. the International Franchise 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. ), a trade association in Washington, D.C., roughly 10% of its 800 members offer home-based options and though many of the brand names may not be as mouthwatering mouth·wa·ter·ing or mouth-wa·ter·ing adj. Appealing to the sense of taste; appetizing: the mouthwatering aroma of a baking pie. as a McDonald's or Krispy Kreme Krispy Kreme is a chain of doughnut stores. Its parent company is Krispy Kreme Doughnuts, Inc. (NYSE: KKD), based in Winston-Salem, North Carolina, United States. outlet, entrepreneurs are grossing upwards of $100,000 a year. With less overhead costs overhead costs see fixed costs. , lower start-up expenses, and driven by the red-hot services sector, home-based franchising appears bountiful Bountiful, city (1990 pop. 36,659), Davis co., N central Utah; inc. 1892. It is a residential suburb N of Salt Lake City with some farming and floral nurseries; machinery and motor vehicles are produced. Bountiful was settled by Mormons in 1847. for African American African American Multiculture A person having origins in any of the black racial groups of Africa. See Race. entrepreneurs. For that reason, BLACK ENTERPRISE compiled our annual list of top franchises best suited for African Americans. Our survey was sent to some 80 franchisors that were designated by the IFA as having cottage operations. BE Research then screened the pool on the basis of affordability, revenue-generating potential, and the number of black-owned franchises--those most likely to seek out and attract minority entrepreneurs. The 10 selected represent those offering the best home-based franchise opportunities for African Americans (see table). FINDING THE HOT SPOTS hot spots acute moist dermatitis. Home-based franchises have enjoyed a resurgence re·sur·gence n. 1. A continuing after interruption; a renewal. 2. A restoration to use, acceptance, activity, or vigor; a revival. these days, benefiting from increased demand in the services sector. According to Don DeBolt, president of the IFA, the current "hot spots" in home-based franchising are chock-full of businesses that "provide a way for people to save time from the drudgery of life." These include home inspection firms, computer repair, and interior decorating. Home improvement and inspection are benefiting from the boom in the housing market and historically low interest rates. With the need for heightened security for both residences and businesses, security services Security services are state institutions for the provision of intelligence, primarily of a strategic nature, but also including protective security intelligence. Examples include the Security Service (MI5) and the Secret Intelligence Service (MI6) in the United Kingdom, and the are also seeing a lot of activity, according to DeBolt. "It's on everyone's radar right now." Austin Monroe, 45, was one home-based franchisee that took advantage of this sweet spot in the services sector. He is the owner of a pair of Lawn Doctor franchises in Stone Mountain and Henry County, which are both suburbs of Atlanta. And while cutting lawns, his business is raking raking of an elephant—see back raking. in the green--to the tune of approximately $100,000 for 2001. The former electrical engineer got into the business when he tired of working in a corporate environment and attended a franchise show in Atlanta in 1990. "I spoke with [representatives from Lawn Doctor] at the show and I did a little research on my own," he recalls. After forking over some $25,000 for the franchise (including marketing material, lawn care equipment, and a lease on a commercial van), by 1991, Monroe was in business. "I worked the Stone Mountain area for about six or seven years and then I got a second franchise at Henry County in 1998 for only $10,000 since I already had the vehicle and equipment." What makes such home-based enterprises like Monroe's so appealing is the cost of entry. According to the IFA, roughly 72% of franchises require an initial investment of up to $250,000, while most home-based franchises max out at an initial investment of $50,000 to $60,000. "On the plus side, they're typically a lower investment than a franchise that you have to operate from a storefront or office building," says DeBolt. "Obviously because of the overhead it's much easier to get into. You don't have a lot of equipment and all the things that go along with that." FREEDOM AND FLEXIBILITY No doubt that home-based franchises have their allure. For one, entrepreneurs have more control over their time. Then there's the general appeal of franchises--buying into a business with a proven track record, the benefits of regional or national advertising campaigns from the franchisor, as well as training and other operations support programs. Be it home-based or not, don't even think of purchasing a franchise without conducting due diligence Research; analysis; your homework. This term has caught on in all industries, because it sounds so "wired." Who would want to do analysis or research when they can do due diligence. See wired. . Make sure you review the company's Uniform Franchise Offering Circular Offering Circular An abbreviated prospectus for a new security listing. Delivered to individuals and brokerage houses, these documents are issued to arouse interest in the new issue. Notes: An offering circular allows investors to access information regarding a new issue. (UFOC UFOC Uniform Franchise Offering Circular ), a sort of disclosure statement for potential franchisees outlining all aspects of the investment opportunity. Also, talk to current and former franchisees listed in the UFOC, and visit the franchisor's headquarters to get a sense of its corporate culture, support system, and its efforts to reach out to minorities to become potential franchise owners. DeBolt also cautions that franchisees should be aware of some of the pitfalls of running a business out of their home. "The minuses are that working out of your home may lack some of the discipline necessary to really apply yourself to building a strong, solid business," he warns. "And a lot of people go to work and just the interaction with people in their office gives them a certain level of life sustenance Sustenance Amalthaea goat who provided milk for baby Zeus. [Gk. Myth.: Leach, 41] ambrosia food of the gods; bestowed immortal youthfulness. [Gk. Myth. to get them through the day. Here you have to supply your own energy." While Monroe says he may someday some·day adv. At an indefinite time in the future. Usage Note: The adverbs someday and sometime express future time indefinitely: We'll succeed someday. Come sometime. sell his Lawn Doctor franchises and either find another area of opportunity or retire, Harrison plans to remain a geek A technically oriented person. It has typically implied a "nerdy" or "weird" personality, someone with limited social skills who likes to tinker with scientific or high-tech projects. The origin of the term dates back to the late 1800s. for the long haul Long distance. Long haul implies traversing a state or a country. Contrast with short haul. . In fact, he seeks to expand his fledgling operation. "Once I get this SBA SBA abbr. Small Business Administration Noun 1. SBA - an independent agency of the United States government that protects the interests of small businesses and ensures that they receive a fair share of government loan paid off, I plan to buy another [location] and hire more techs," Harrison explains. "I'm also trying to get my 8(a) status to get government contracts." While these franchisees have different long-term goals Long-term goals Financial goals expected to be accomplished in five years or longer. , both are building wealth by managing growing businesses--all from the comfort of their own homes. RELATED ARTICLE: A taxing way to build a business. although not a home-based franchise, Colbert/Ball Tax Service in Houston is one of the few black-owned franchisors in the nation. Their goal to carve out to make or get by cutting, or as if by cutting; to cut out. - Shak. See also: Carve a slice of the tax-preparation pie dominated by such heavy-hitters as H&R Block Inc. and Jackson Hewitt  An editor has expressed concern that this article or section is .Please help improve the article by adding information and sources on neglected viewpoints, or by summarizing and Inc. Grossing $1.4 million in revenues for 2001 and projected to boost sales to $2.5 million for 2002, Colbert/Ball operates 28 locations in 12 cities, mostly in the South. The company's tax preparation services Tax preparation services Firm that prepare tax returns for a fee. mostly focus on providing quick refunds to customers, and it hopes to open 100 locations by the end of 2002. "We specialize spe·cial·ize v. 1. To limit one's profession to a particular specialty or subject area for study, research, or treatment. 2. To adapt to a particular function or environment. in [preparing] electronic tax returns and we focus on a 24-hour turnaround on tax refunds Tax refund Money back from the government when too much tax has been paid or withheld from a salary. ," says Al Colbert, 29, who along with first cousin, Ja Ja Ball, 30, founded the firm in 1994. The two, who are 60-40 partners, started the business during their senior year at Texas Southern University. "I was an accounting major and Ja Ja a business major, and we were looking [into] going into business [together]," says Colbert. "We looked at the tax industry because we knew a few that were successful at independent locations. We had saved up some money from our jobs and we had some family members that helped us out." The pair raised roughly $17,000 to open up their first location in 1995. The two found that starting an enterprise was a taxing proposition. With a not-so-grand opening that didn't lure lure the skin-covered object which runs on a monorail on a Greyhound racing track and which the dogs are schooled to chase. The lure must be kept 30 to 40 ft ahead of the leading dog so that the field is stretched out. a single client, the two had to wait four days before their first customer crossed the threshold of the new office. With initial business slow, the fledgling firm went back to the marketing drawing board. Gone were the fliers, newspaper ads, and direct mail. Instead, they purchased a more visible sign for their office, and took out a series of radio ads. "We also started a referral program where [if] customers referred other people to us, we'd compensate them $10," points out Colbert. That strategy worked. Colbert/Ball processed some 270 returns its first year, making enough to move its main office from a low-income area in Houston's Third Ward to a business district in the Astrodome as·tro·dome n. A transparent dome on the top of an aircraft, through which celestial observations are made for navigation. Noun 1. area. After processing more than 4,000 returns in 2000, the pair thought about expanding. Why not become a franchisor? "We tested the market by setting up an affiliate program under a license agreement in Dallas," says Colbert. "We felt we had developed a good system and we wanted to share that system not only to give others an opportunity, but to grow our business." To go from a one-office operation to franchisor, Colbert/Ball took the following steps: * Identified a local franchise attorney that helped it structure the franchise agreement--a document granting the terms in which the franchisee can operate under the Colbert/Ball umbrella, and the UFOC. Colbert and Ball then defined and carved carve v. carved, carv·ing, carves v.tr. 1. a. To divide into pieces by cutting; slice: carved a roast. b. out the territories that each franchisee will have so they will not compete with each other if they were within the same neighborhood. At the same time, they developed an operations manual that franchisees could follow. * Creating a support mechanism for franchisees, including training, marketing, and technical assistance in running a Colbert/Ball franchise. * Finally, they found individuals interested in purchasing franchises. "What we had found out is that our business has grown through word of mouth," says Colbert. But to complement that, Colbert/Ball took out a series of advertisements in magazines and newspapers. Start-up costs for Colbert/Ball franchises range from $11,000 to $19,000, which include a franchise fee of $3,500, and cover the cost of two or three personal computers, a laser printer, copy machine, file cabinets, and other standard office supplies Office supplies is the generic term that refers to all supplies regularly used in offices by businesses and other organizations, from private citizens to governments, who works with the collection, refinement, and output of information (colloquially referred to as "paper work"). . One thing entrepreneurs have to keep in mind: The tax preparation business is highly seasonal with virtually all the revenues generated from January to the April 15 tax-filing deadline. Ball says a typical franchisee can expect to prepare 300 to 400 tax returns in that period and take in roughly $50,000 during their first year of operation and more than $100,000 by their third year. In fact, most of their franchise locations only remain open during that period. Franchises charge an average of $115 to $140 for each return, of which $22 goes to Colbert/Ball, which is their royalty fee and is based on the number of returns completed. "Over 80% of the people who come in for these services are black," says Ball. "But they don't have that many business owners that are servicing all these people. We have more in common with the people we're servicing so we know how to service them."
Top 10 FRANCHISES YOU CAN RUN FROM HOME
Company Location Telephone
Number
BuildingStars Inc. St. Louis, MO 314-991-3356
West Sanitation Services Inc. Torrance. CA 310-793-4242
Coverall North America Inc. Ft. Landerdale, FL 954-351-1110
Open Works Phoenix, AZ 602-224-0440
The Home Team Inspection Cincinnati, OH 800-598-5297
Service Inc.
ServiceMaster Clean Memphis, IN 800-633-5703
Novus Franchising Minneapolis, MN 880-328-1117
Lawn Doctor Inc. Holmdel, NJ 890-631-5660
Merry Maids Memphis, TN 901-537-8100
Rainbow International Carpet Waco, TX 800-280-9963
Care and Restoration
Company Type of Business Black
Owned
Units
BuildingStars Inc. Commercial Cleaning 45
West Sanitation Services Inc. Restroom Deodorizing 8
Service
Coverall North America Inc. Commercial Cleaning/ 2,558
Industrial Services
Open Works Commercial Cleaning 22
The Home Team Inspection Home Inspection 6
Service Inc. Service
ServiceMaster Clean Disaster Restoration- 40
Commercial and
Residential Cleaning
Novus Franchising Mobile or Fixed 3
Windshield Repair
and Replacement,
Paint Restoration,
and Paint-Less Auto
Dent Repair
Lawn Doctor Inc. Automated Lawncare 4
Merry Maids Residential Home 14
Cleaning
Rainbow International Carpet Indoor Restoration 3
Care and Restoration and Cleaning
Company Domestic
Franchise Start-Up
Units Costs *
BuildingStars Inc. 103 $1,495-$8,000
West Sanitation Services Inc. 65 $2,800
Overall North America Inc. 6,395 $6,300-$35,900
Open Works 341 $15,000
The Home Team Inspection 325 $19,450-$46,050
Service Inc.
ServiceMaster Clean 2,917 $20,283-$84,525
Novus Franchising 412 $22,000-$120,000
Lawn Doctor Inc. 430 $27,500
Merry Maids 875 $32,500-$49,500
Rainbow International Carpet 283 $47,100-$93,900
Care and Restoration
SOURCE: B.E. RESEARCH
* INCLUDES FRANCHISE FEE
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