The dream of business ownership may seem unobtainable during a time when so many businesses are struggling or closing altogether. But, when the going gets tough, the tough get going. With these tough times, it feels like the entire world has changed. Change offers opportunities, and it’s a great idea to position yourself to take advantage of them. Certainly, other people who share your interest in owning a franchise business have continued to move forward. According to Franchising.com, Google search trends show that, “[a]fter experiencing a sharp dip in early and mid-March, interest spiked again near the end of the month and has continued to rise in early April.” Embrace your entrepreneurial spirit and move towards achieving your dream of business ownership.
The Gift of Time
When work is busy, it can feel like there aren’t enough hours in the day to get everything done, particularly when it’s researching your dream of business ownership. With orders to shelter in place, we are gaining hours in the day just from skipping the daily commute to and from home. Use that time wisely by beginning to do the diligence it takes to make an informed decision about franchise business ownership. Here are three things you can do:
- Talk to an advisor: an experienced professional who knows the franchise business, preferably from both sides of the equation. The time from the initial consultation to franchise business ownership can take three to five months. Getting started with this critical relationship is a great first step that can line you up to be going into business just when the market is rolling again.
- Do some research: The franchise world is incredibly varied. There are thousands of franchises across a wide array of industries. Some franchises are better suited to your situation, strengths and preferences than others. In this period of uncertainty, there are franchise businesses that offer better prospects for surviving and thriving as we pass through the pandemic and market challenges. Now, more than ever, it’s important to think and act strategically.
- Get your ducks lined up: Buying a franchise business takes effort. You need to make sure your family is on board for the change. You need to have your finances organized and ready to present as part of the purchase process. And, while good franchise businesses provide training and support for new franchisees, you should make your own business plan, which will be something you will be required to furnish if you are financing the purchase.
Funding Options Have Never Been Better
The economic stimulus efforts by the federal and state governments, offer multiple aspects that bode well for the prospective franchisee. First, under the federal CARES act, there has been a significant relaxing of the rules for leveraging retirement funds, which means qualifying people can either withdraw funds without penalty or take a significant loan on their 401(k). Second, SBA loans are at their lowest interest rate levels in recent history. Between these two attractive resources, the ability to finance the purchase of a franchise business has never been cheaper.
Franchisor Flexibility
Given the state of the economy, with daily news about businesses shutting down and people losing their jobs, franchisors are justifiably concerned about their prospects. While they won’t publish new terms or relent to any and all demands, they will be open to counter-proposals that will work to the franchisee’s advantage. It’s not necessarily obvious what to ask for and what possibilities to explore, but if you work with a good advisor who can identify opportunities for negotiation, you will find that you have some significant bargaining power at this time.
Joshco Partners has decades of experience in franchising from both franchisor and franchisees sides of the business. If you see this time of uncertainty as a time to seize the opportunity to own your own business and you want expert guidance, contact us today to get started.