Franchise Business Consultant in Central Texas, West Texas and Rio Grande Valley

Call Us Today Tel: 512-329-2613

All posts by FranNet Texas

Think You Can’t Afford to Buy a Franchise? Think Again

Dreaming of becoming a business owner but feel you don’t have enough money? If so, there is a surprising solution that could solve your problem – using your retirement funds – better known as 401(k) business financing or Rollover as Business Start-Ups (ROBS).

Before you get nervous about depleting your retirement fund, read on. ROBS can allow you to use your retirement money to fund your company without early withdrawal fees and tax penalties. And, as your company performs well, your profits can go back into the account to provide retirement funds for both you and your employees.

“Most small business owners and employees don’t have the benefit of a corporate retirement 401k account, but this makes it possible,” said Merri Cronk, owner of FranNet Texas Southwest.

According to Cronk, another great benefit of ROBS is control.  “One of my clients recently shared that he thought ROBS was a good idea because he wanted control over how those funds would perform rather than have them in the volatile market.”

For other aspiring business owners, ROBS offers them the opportunity to get into business without going into debt.

“It’s a great fit for people who have a philosophy of investing in themselves and appreciate the benefits of using equity vs debt to buy a business,” said David Nilssen, CEO of Guidant Financial, a company that specializes in helping people find the right financing to start their small business or franchise.

Another great advantage of ROBS is that it’s very fast. It can be completed in about three weeks, which is a significant benefit to someone buying a business in a competitive environment.   

ROBS is also much easier to get because it’s using your own money. Unlike other types of funding methods, your credit score, past experience or on-hand collateral won’t impact your ability to get the funds.

While ROBS may seem too good to be true, there is a caveat. As with any investment, there is some risk of losing the funds if your business doesn’t do well. The good news about this risk is that you have the power to control it to an extent. If you do your research upfront and have solid business plans that you are extremely confident in, the risk is fairly low. 

One great way to reduce the risk is to use the money to invest in a franchise, which already has a proven track record of success.

If these philosophies resonate with you and ROBS seems like an appealing option, you’re probably wondering if it would work for you and how much money you need in your retirement account to set one up.

According to Nilssen, ROBS works for individuals who have capital in an IRA, 401k or other qualified vehicle. He says most ROBS transactions are for 49 percent of the client’s personal equity, which is usually between 50K and 250k. So, you must have worked long enough to save that much money. That means that most ROBS candidates are over 40 and have 10+ years of corporate experience. They also have great credit.

For more information on franchise ownership and whether ROBS is a good idea for you or not, call Merri Cronk at 512-329-2613.

Back

Former Engineer & Professor Discovers the Life Changing Opportunity of Franchise Ownership

With a lot of people who enter franchising, you hear the moniker, “Second Act” of their careers. But with Debbie McMahon, proud owner of a Big Frog Custom T-Shirt franchise in San Antonio, TX, we’re talking fourth or fifth act. Debbie has enjoyed an illustrious career that has taken her all over the country and then some. She actually started her career in electronic engineering, logging 25 years in the industry. How did she follow that up? Went back to school, earning a Bachelor’s, Master’s and PhD in Applied Sociology along the way! The educational achievements led her to a teaching position at Baylor University. While it all sounds good on paper as you’re reading it here, there were still the nagging complaints many current franchisees remember about Corporate America. It was no fun. Salaries plunged. Workload skyrocketed. Debbie made the same decision most franchisees come to make. Enough was enough.

“I was completely ready to try something else,” stated McMahon. “I like learning. I like doing new stuff. And I once ran a business of my own in the past—a machine shop and maid service. What a combination, right?” Debbie was primed for a moment that would lead her to a new chapter in life—franchise ownership.

Debbie made the decision to visit San Antonio’s small business center and it was there that she was referred to Merri Cronk, FranNet representative for central, south and west Texas. The visits and assessments with Merri were eye-opening experiences. “I’m a Sociologist, per my education, so I can really assess people,” stated McMahon. “As a professional, Merri was thoughtful, personable, concerned and had a business integrity that was obvious. I had no idea what kind of franchise I was cut out for and I was ready to explore all avenues. Merri took a data-driven approach, which worked perfectly on me because that’s how I think. She used great tools to guide me and I loved the testing and assessment because I have an innate understanding of methodology.”

What McMahon wanted most was the autonomy to own and operate a business of her own. She was willing to listen and explore. She ended up heading down the retail category path, with Big Frog Custom T-Shirts becoming a natural candidate. “I’m a workaholic, a bit introverted, but I still wanted to have a way to give back to the community,” stated McMahon. Big Frog offered all three possibilities. It was the franchise Discovery Day that really sealed the deal. “I could see the ethos of the brand and its franchisees,” stated McMahon. “They were family oriented. Invested in the entire franchise and very authentic.” Keep in mind, McMahon knows how to read people.

What’s been the biggest change in her life since opening her Big Frog franchise in May 2018?

“The challenge of it all is exciting,” says McMahon. “I no longer work from home. I have to get up and put on my shoes every day now. There’s a little less time than before and a little less relaxation, but the thrill of running a business of my own—you can’t put a price on that.”

As McMahon plans for the future, she’s working towards a goal of building the business up to a sustainable level, where a semi-absentee ownership model would enter the picture. The Big Frog franchise definitely fits into her retirement plans, though she’s not ready to hang up her screen printing machines just yet.

“Working with FranNet was a life-changing opportunity for me,” says McMahon. “People should know that their advice and navigation of the franchise landscape is extremely valuable. These are data-driven representatives and I would know. They have real expertise. They have their finger on the pulse of the industry and aren’t trying to hawk a certain business. They’re in it to find your true match. I just think that’s a thoughtful way to do business.”

Back

Franchise Training Programs Speed Up Profits

One of the greatest advantages of investing in a franchise instead of starting a business from scratch is that franchisors provide training to help owners launch and run the business successfully. 

When starting a business from scratch, you are by yourself and left to either figure out what works or find someone with the expertise in areas you don’t have. While this is possible, it’s very time consuming. And, time is money in business. The longer you take to figure out what works, the more you delay profitability.

So, if you would rather take the fast route, what can you expect from a franchisor in the area of training? Here are a few questions to ask about what is provided before a launch and afterwards.

Franchise Pre-Launch Training Check List

  • Does the franchisor provide written documentation or training manuals/digital training programs?
  • If your franchise is a brick and mortar business, will someone from the corporate office provide training on site? Or, will you and your staff need to travel to the corporate office?
  • Does the training include repetition to ensure that you and your staff are ready to provide the level of service desired by the franchisor?
  • Does the training include the following topics?

Real estate selection and site development

Product or service knowledge

Standards and procedures

Leadership training

Management skills

Problem solving skills

Human Resources management and training

Customer relations

Branding management

Marketing, advertising, and communications

Merchandising and pricing methods

Safety, security, cleaning, and maintenance

Vendor relations

Inventory management

Financial management including book keeping and record keeping

Information systems and programs

Ongoing Franchisee Training

  • Will the franchisor provide refresher trainings at your location or as a group in another location?
  • Is there a fee or travel expenses required for the ongoing training?
  • Does someone from corporate do site visits to check for quality and train employee on any deficiencies noted?
  • Is there a system to train managers to train new employees?
  • Do they provide refresher courses or trainings on new procedures?
  • Do they provide resources for you to learn how to solve problems?  

Another important aspect one should consider when shopping for a franchise is whether or not the franchisor is forward thinking and adapting to new marketing and customer service trends.

“All franchises evolve with the economy, technology and customer needs, so it is important to find a franchisor that is working for the future of the business and anticipates changes before they happen,” said Merri Cronk, FranNet Texas Southwest owner and franchise consultant.

As you can see, there is a lot to consider when looking for a franchisor that provides great training services. If you want to save research time, consider using a franchise brokerage service like FranNet that fully researches the franchises they offer prior to offering them to clients to make sure they provide excellent training services that will help you have maximum success.  FranNet also provides free consulting up front to make sure the franchise you choose best meets the kind of business model, training and support you need.

If you would like to explore the franchises available through FranNet or sign up for a free consultation, click the “Get Started” button at the top of this page.

Back

Why You Should Start a Franchise While Still Employed

Not quite ready to leave your job but still want to invest in your future? Franchise ownership can make that happen.

Whether you’re happily employed, tired of the corporate rat race or stuck in a dead-end job, running a franchise part-time while you’re still employed is possible and can be a smart way to achieve your personal and financial goals.

Here are three reasons why it’s a good idea:

  1. Achieve Your Retirement Goals: If you’re happily employed but don’t think you can save enough for retirement on your salary, owning a franchise on the side can give you a way to build equity in a business that you can sell for a profit when you retire. Or, you can keep the franchise well into retirement and use the profits as a source of income.
  2. Escape the Corporate World: If you’re not enjoying your job, feel it’s at risk from downsizing or age discrimination, or you’re just plain tired of the corporate world, a franchise can allow you to generate a significant income stream on the side as either a safety net or nest egg to use after quitting your job. In both scenarios, you may need or want to keep your job for a period of time while the franchise ramps up to a financial level that can sustain you. Then, you’re free!
  3. Leave a Legacy for Your Family: A franchise can be a great asset to pass down to your children to manage as an ongoing income source. Or, they can sell it for a lump sum that can be used how they please.

At this point, you might be thinking this is an appealing option. But, you also might be wondering how you can run a franchise while working full time. It may seem daunting, but it’s easier than you think.

Many franchises are set up to run as “semi-absentee” ownership models. This means that the owner does not need to manage the business full time. They can hire people to run the day-to-day operations of the business, while they continue to work for another company – or enjoy more leisure time for family and hobbies.

According to Merri Cronk, Owner of FranNet Texas Southwest, this model works well for those employed full or part time – as well as for parents who need to juggle work and family responsibilities.

“Many semi-absentee models provide a great deal of flexibility, which allows people with children or serious hobbies to create a schedule that works best with their lifestyle,” says Merri. “It’s an especially good scenario for moms and caretakers.”

All of that said, franchise ownership is not for everyone. They do require a significant commitment up front while working at your other job. However, some franchises require less set-up time than others.

If this is intriguing but you’re not sure it’s a good fit for you, Merri and her team of franchise consultants will help you assess your readiness for no charge. If it makes sense to move forward, they can match you with a quality franchise that best fits your specific goals and lifestyle needs.

To learn more or sign up for a free consultation, click the “Get Started” button at the top of this page.

Back

3 Reasons Franchise Ownership is One of the Best Investments

When people think about the best investments for the long-term, they often think about buying stock, putting money in a 401K or becoming a real estate mogul. While these investments are all good ideas to prepare for retirement, there is another smart way to invest that many people miss – franchise ownership.

Here are three reasons why franchise ownership is a smart investment:

1Ongoing Income Past Retirement Franchise ownership can not only help you build up a nest egg before retirement but also provide significant income during retirement. If a business model is chosen that can be run by a manager, you can work part-time while still enjoying a full-time income flow well into retirement.

2. Equity Building – Franchise ownership also allows you to build equity in a business that can be sold to an investor or transitioned to family member. For example, if one spouse passes away, the other spouse will be left with an asset that can be either sold or continue to bring in income for ongoing support. While running a business might be overwhelming to some spouses, most franchisors offer a support system and training that could help them transition into managing it. If they really don’t want to do that, they could sell the business and invest the profits elsewhere.

3. Faster Wealth Accumulation – Another great advantage of franchise ownership is that it allows people to increase wealth more quickly than traditional business ownership. Because a franchisor has already worked through the challenges of finding a successful business model, a franchise can be up and running and generating income much more quickly.

If this investment option is intriguing and you would like to explore it further, click the “Get Started” button on the top right of this page and we would be happy to talk with you.

Back