Is Franchising for You? Ask Yourself These Questions. The author of "The Wealthy Franchisee" offers reflections to help decide if franchising is the right path for you.
By Scott Greenberg Edited by Dan Bova
Key Takeaways
- It’s not enough to evaluate a business before buying. You need to examine the lifestyle. If you don’t like roller coasters, you may not like franchising.
- Deciding to be a franchisee will affect your life as well as those around you.
- Make your decisions based on facts, not emotions.
Opinions expressed by Entrepreneur contributors are their own.
This is part 4 / 6 of The Wealthy Franchisee: Section 1: Getting Wealthy Through Franchising series.
Not everyone has the stomach for running their own business. While a traditional job can also be quite challenging, it's structured and predictable. You can plan your life around a regular paycheck. You feel (whether or not it's true) that you're part of a stable company with clearly defined rules and a climbable ladder. And doing a job is different from maintaining a business. After my brother graduated medical school, he wanted to set up his own practice. He liked the idea of building something he could run himself. His close friend didn't share those aspirations. He just wanted to practice medicine. He's perfectly happy working for an HMO and letting others count the beans. Some people need the freedom of business ownership. It's more of an adventure. There's risk, adversity, and the chance of enormous financial gains—or nothing at all.
Related: Explore great opportunities on the Franchise 500
Running a franchise is a modern-day treasure hunt. The question is, is that for you? You could do the same things wealthy franchisees do and get the same financial payoff. But if you don't enjoy the journey, you won't have the quality of life to meet our definition of "wealthy." It's not enough to evaluate a business before buying. You need to examine the lifestyle. If you don't like roller coasters, you may not like franchising.
My Journey as a Franchisee
Those who can, do, and for ten years, I did. I proudly owned the title "franchisee." That pride was as much from what I overcame as from what I accomplished. It was an intense time with ups, downs, and plenty going sideways. I'm going to share with you the highlights of that wild decade. As I recount my journey, try to put yourself in my shoes and imagine having the same experience. I'll discuss what I went through as well as what it felt like. I'll pause periodically throughout my story to give you a chance to reflect on how it would feel to you.
I Blame My Father
My father is a serial business owner. He's never had a career, just a long string of small businesses and a few jobs in between. He's owned a luggage store, a sandwich shop, and a handful of ice cream parlors. He also got involved with a number of franchises. At various points, he owned a Winchell's Donuts in Los Angeles, a Love's BBQ in Denver, a Papachino's Ristorante in San Diego, and several PoFolks restaurants throughout Southern California. Some of his businesses were cash cows and others were money pits. Ups and downs. Good years and bad. Milkshakes and migraines. I grew up watching him navigate through it all. Fortunately, with the help of my working mom's patience, faith, and health insurance, he made more than he lost, enough to move us into a better house every few years, buy himself some nice stuff, and support us through college.
Related: Discover 5 Top Retail Franchise Opportunities to Invest In
My father is still a bloodhound for new business ideas. It's not unusual at family gatherings for him to go on about some new concept he's heard about. But in 2005, when he showed me an airline magazine ad for a fruit basket franchise called "Edible Arrangements," he caught me at the perfect time. I'd already been speaking professionally for 12 years and was looking for an additional stream of income. Speaking was going well, but my wife and I were starting a family and I wanted to begin spending more time at home. I traveled to Connecticut to attend a Discovery Day at the Edible Arrangements corporate office. Their presentation knocked my socks off. We learned all about the operation, their plans for the future, and what the current opportunities were. We sampled the product. We visited their corporate store. We asked question after question. We met team members from operations, marketing, and franchise development. Everyone in the office was young, dynamic, and passionate. They knew they were part of something special. My mind raced throughout the flight back to California. What a cool concept! What spectacular franchise partners! I took out paper and pen and brainstormed what I could do with the business. I had all kinds of ideas the corporate office hadn't even thought of. I was excited at the prospect of owning an asset. I wasn't going to end my speaking business, but I needed to build something else that would generate its own revenue and increase in value. It would also be a great opportunity to test my leadership concepts in the field. So many speakers hadn't done anything other than speak. I wanted to walk my talk. As soon as my plane touched down in Los Angeles, I called my father. I wanted to do this. He also wanted in. We agreed to each invest in our own Edible Arrangements franchises.
Reflection: Ask Yourself These Questions
- What are your reasons for wanting your own business?
- What emotions does the idea of business ownership stir up?
- How are those emotions affecting your judgment?
- How might having your own franchise impact your lifestyle?
Making a Decision That Works for Everyone
The hardest part of putting the deal together was convincing my wife. Rachel and I had very different upbringings. Her father, Ron, is a world-renowned professor emeritus who had two jobs his entire career. He and my mother-in-law lived in the same house in Chicago until moving to Los Angeles for Ron's second professorship at UCLA, where he worked until retirement. They've always lived simply and invested conservatively. Ron was never profit-driven. His primary desire was to contribute to a body of knowledge. My father-in-law is as loyal and content as my father is restless and ambitious. Whereas I was raised in the frenetic world of speculative entrepreneurship, my wife grew up in the stable world of tenured education.
Related: Building a Strong Corporate Culture for Lasting Franchise Succes
Investing money I didn't have in a business I knew nothing about was normal to me. To Rachel, it was utter folly. Her resistance angered me. Couldn't she see the opportunity? Didn't she trust me? We can't improve our lifestyle if we succumb to fear. Life is about risk. Life IS risk! "But Scott, how are we going to finance this?" she asked. "How long will it take to get our money back? What if the business doesn't do well? And who are these Edible Arrangements people, and why should we trust them?"
Every doubt-filled question further enraged me. It felt like she wasn't just questioning my idea; she was questioning my judgment. But she did force me to answer questions I should have already been asking. I really hadn't thought this through or vetted the franchisor. My readiness to sign was purely an emotional decision, not a logical one. I finally realized that the only way we could make this choice together was by getting the facts. Maybe that would ease my impulsiveness and alleviate her fear. We needed to control our emotions. So we did our homework. We crunched the numbers. We slowed down and let time work its magic on our feelings. Eventually, we were able to take a more calculated risk, so with Rachel's blessing, I pushed the red button.
Reflection: Ask Yourself These Questions
- Who else will your choices impact?
- Who questions your choices and keeps you in check?
- How open are you to being challenged by others?
- Should you allow others to talk you out of your dream?
- Do you do enough due diligence when making important decisions?
