Is franchising right for you? A Scottsdale couple started a new territory for a mobile pet grooming franchise called Aussie Pet Mobile, and now they share their experience with you.
When he worked as a top performing sales executive for a large telecommunications company that was going through bankruptcy, Jay Feitlinger, with his wife Rachel, decided that they needed to make a few changes to better secure their future. They wanted to travel, have children, and enjoy their lives. The threat of being let go due to company restructuring, and the fact that job market in Arizona was not providing the right opportunities, induced them to consider opening their own business.
Jay and Rachel have agreed to share their experience in the hopes that their adventure will assist others who are thinking about making such a change.
Start a Business or Buy a Franchise?
While researching starting a business, The Feitlingers created a few different business concepts. The risks seemed huge; the statistics relative to opening a small business were quite discouraging. Running a franchise seemed safer, and they decided it would give them experience in operating a business.According to a Department of Commerce study done in 2001, 83% of independent small businesses fail after five years. Some of the reasons that might contribute to this startling statistic are:- Choice of business was based on personal interest rather than sound business opportunity. For example, I love to ride bikes--I'll open a bike shop.Little or no business operations knowledge, such as human resources issues, legal requirements, accounting principles, advertising and marketing.
- Insufficient support and training, such as employee training and management skills.
- Didn't research local demographics and trends.
- Must learn from their own mistakes which slows their growth.
- Lack of funds. They don't have enough money to support the business needs.In the same study, however, it was noted that 92% of all franchises are still in business ten years later.
What gives franchises an advantage?
- Franchising provides the consistency that consumers have come to expect in the marketplace--a certain look, quality of service, etc.
- Franchising can give franchisee an established consumer base and possibly already established national accounts.
- Provides training, support, operations manuals, site selection, quality demographics, store design, construction programs, reduced cost of equipment, national purchasing power (things that typically an independent has no background to do his own successfully).
- After business opening a franchise organization may offer periodic training, home office and field assistance, buying cooperatives, grand opening programs, advertising and other marketing materials to which an independent does not have access.
- Franchise systems can afford to modernize through ongoing research and development and by test marketing new products and operating systems.
- Combined spending power
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