It’s a rare week when you don’t patronize a franchise business. Maybe you stopped and grabbed a sandwich on a busy afternoon, or mailed a package cross country to a relative, or got a haircut in the mall when you were shopping for a gift.
These businesses all may have been owned by people just like you; people that put their trust in a brand that is well known and well respected. They committed to that brand and opened a business, trusting that being a franchisee was the best route for them to take.
But is taking the path of franchise ownership the right path for you? Or perhaps charting your own course and opening a business without being a franchise is a better option for you? Let’s take a look at several scenarios, and you can see which one you identify with more. Hopefully, this will be of help as you make a decision on which road is best for you to take.
Scenario 1
John is seriously contemplating his options after 20 years selling insurance for a major life insurance company. He’s been very successful in his career, having specialized working with business owners who wanted to work with an agent and company that could provide retirement planning for the owners and employees. John took this route of specialization because he wanted to work with business owners during regular daytime business hours and be home with his family in the evening. It has worked out well for him.
John loved the independence that selling insurance provided him. He could select his clientele and work as many, or as few, hours as he wanted. John also liked having the advantage of being part of a nationally known insurance company, one that advertised heavily and sponsored major sporting events. He liked the credibility of the brand and how it opened doors for him that would have remained closed if he had been a solo practitioner of life insurance selling.
As time went on, John grew tired of sales meetings and monthly sales quotas. He felt that as an experienced, successful agent, all of the training sessions were a waste of his time. As far as quotas were concerned, John thought that he should be exempt from them because of his track record of consistent success.
One of the major reasons John was considering leaving the company was because he had been passed over for sales management positions several times. When he questioned the regional manager as to why he didn’t get the jobs, John was told that he was too much of a “lone wolf” and didn’t follow company procedures very well. John protested this, saying that he wouldn’t have succeeded for so many years if he wasn’t a team player.
Scenario 2
Mary is a rising star at her real estate company. She’s been with the company for eight years, and each year she sold enough homes to qualify for the President’s Circle Award, which is given to top producers and is a coveted honor. She owes her success in part to the fact that she has been willing to work days, nights, and weekends to build a successful career.
Mary represents a nationally known company that is recognized as a leader in the residential sales industry. The company has just celebrated its 75th anniversary and recently opened its 130th sales office. Mary is an independent representative of the company; she is not an employee. Because of this status, she receives no company benefits. But this doesn’t concern Mary. Because she is a top producer, her commission income comfortably affords her the ability to pay for her benefits.
Mary has been very happy with her agency for the past eight years. The company brought her on board after she had spent several years as an executive secretary, even though she knew almost nothing about selling real estate. They provided her with all of the training and mentoring she needed to succeed. She was allowed to use the company logon on her business cards and stationery, which helped with her credibility with new prospects. She was very appreciative of this.
Mary is considering leaving the agency because she sees how much money the broker that owns the office is earning in annual compensation. This amount is at least more than double what Mary makes as an individual producer. Mary would like to be the broker of her own agency and is seriously considering moving to a competitive brand that is known for its extraordinary support of its brokers.
Her new company will provide her with a nationally known brand, all of the support she needs to start her office and run its day-to-day operations, as well as a very substantial commission package. She will also benefit financially from the production of all of the independent real estate agents selling in her office; she welcomes the opportunity to teach and train new agents.
Now that you’ve read both scenarios, who do you think would be happier, and likely more successful, as a franchisee?
If you chose Mary, you would be correct in your assumption. Mary has shown the ability to work closely with a name brand and adopt their business model for success. She welcomed company training and was willing to work whatever hours it took to achieve her goals.
She also welcomes the opportunity to help others, which she knows will contribute financially to the success of her agency. Though she has succeeded in working independently, she has always welcomed the opportunity to take the training and suggestions offered by her broker, as well as the opportunity to help new agents when they joined the agency.
If you can relate to Mary’s situation and temperament, you may very well be an excellent candidate to pursue the path of franchise ownership. Having the support of an established brand, coupled with your willingness to put in the hard work necessary, is a formula for success.