How to Start Your Own Business Franchising vs. Start-Up

What We Will Accomplish An Overview of Franchise vs. Start-Up You’re Going to do What? Why? Lay of the Landscape Matching the Why to the Which One

Who I am Explains My Choices – My Why Entrepreneur Manager Risk Taker Risk Minimizer Experienced New to This Independent Structured 30,000 Feet In the Weeds People Oriented Process Oriented Collaborative Commanding It is a continuum, not one or the other

What Do I Want? Your Driving Force Fulfill my passion at work Work to support my passion outside of work Make lots of money Have a balanced work and personal life Leave a legacy to my family Help others succeed

Personality Assessments Behavioral and Driving Forces Assessment Myers-Briggs Type Indicator - one of the most well-known assessments The Caliper Profile personality traits Minnesota Multiphasic Personality Inventory HBDI – Hermann Brain Dominance Instrument

What is a Start-Up? The word Start-Up used in technology and innovation General Definition - You have an idea for a business - You create everything from scratch

But you are starting from zero What is a Start-Up? You have experience in a profession Idea to launch from scratch But you are starting from zero

Characteristics of a Start-Up National Mom and Pop Business Day March 29th If it is your profession, you can have the independence you always wanted If it is a new idea, a patented product, it can be exciting Opportunity to create your own success You leave a legacy for your heirs

What is a Franchise? “You use common branding with common systems within a proven business model” - Rand Walker Is a distributor or business opportunity a franchise?

What is a Franchise? Is it a Franchise if it is on the SBA list of Franchises? SBA says a Franchise is "A legal and commercial relationship between the owner of a trademark, service mark, trade name, or advertising symbol and an individual or group wishing to use that identification in a business. The franchise governs the method of conducting business between the two parties."

Characteristics of a Franchise Many are retail or service businesses Volume purchasing Shared advertising and marketing cost Invests in a proven system which limits start-up and operational pitfalls You do not deviate from the operations manual

Start-Up Franchise Lay of the Landscape Not in Business Risky Less Risky Going Concern Less Risk Even Less Risk

Start-Up Not In Business Start from zero with no road map Most risk of all options Validate the idea before you invest Has the most opportunity on the upside if scalable

Start-Up Going Concern You can be out front on day one You can make changes to brand it your own You don’t answer to someone else so you can try new ideas You can expand geographically and into new target markets

Franchise Not In Business You have a road map Someone has done it and shows you how Less risky but you still have to go from zero to operational Faster cash flow if a recognized brand and product

Franchise Going Concern You have cash flow Immediately There is a team that knows your business You have a foundation to build on with new ideas from your franchisor

Matching the Why To the Which One These are NOT key factors because they apply to all options. You must have : Significant funds, assets and/or credit to invest Ability to manage or to hire a good manager Understanding of financial reports, cash management Knowledge of marketing and sales or hire someone who has Learn to file government reports on time

Step #1 Discover your Passion Will it be: Helping parents with their childcare gives you peace Working with animals brings you joy Designing clothes delivers satisfaction Producing beautiful artwork calms you

Step #2 Know Yourself A Franchise might be a better fit if you are: More Manager than Entrepreneur More Risk Minimizer than Risk Taker More New-to-Business than Experienced More Structured than Independent More Detail Oriented than Creative Thinker

Step #3 Review Your Finances Do assessment of your personal financial goals Consider how much risk you want to take using savings and investments If you are closer to retirement don’t use your retirement funds for the business Do a review of funds available from family & friends, partners, equity in property, government grant and loan programs, etc.

Step #4 Assess Your Skills and Abilities Rate these from 1 to 10: Business management skills People management experience Understanding of financial reports and cash management Marketing, including digital media marketing Sales skills Any item less then 4, get training Any item 5-9, get more advanced training

Match Up You & Lay of Landscape Start-Up Franchise Not in Business Highly flexible Independent High Risk Taker Structured Will follow the Plan Will accept direction Going Concern May need income now but could look for a turn around Looking to expand and scale Have Resources Stay Steady on Course

Match Up You & Landscape Franchise From Zero Franchise Going Concern Start-Up From Zero Start-Up Going Concern Can’t survive one year without income? A big Risk Best Choice A Big Risk Good Choice

Match Up You & Landscape Franchise From Zero Franchise Going Concern Start-Up From Zero Start-Up Going Concern Do you want to do it your way? Will Not Work Good Choice

Match Up You & Landscape Franchise From Zero Franchise Going Concern Start-Up From Zero Start-Up Going Concern Have a lower risk tolerance? Better Choice Best Choice Good Choice

Match Up Once you review specific Start-Up or Franchise Options: Ask a lot of the right questions Use a business broker if you don’t want to search on your own

Match Up And Use the local entrepreneur resources - Score, Hatch, ODU Center for Enterprise Innovation Go to randwalker.com for local resources

Questions?