Sole Proprietorships Being Your Own Boss

Sole Proprietorships “A one-owner business.” Most common form of business in the U.S. (76%) Pros: Easy to organize Quick decisions can be made All profit goes to one person Pride in the business

Sole Proprietorships (Cont’d) Cons: Limited resources to start and operate Unlimited liability: Responsible for all debts of a business Limited life: Business ceases to exist when the owner dies High failure rate: 70% fail within 5 years

Franchises “A business arrangement which allows a business to operate under the name of an established brand, like McDonald's.” Most are sole proprietorships, but can take other forms

Franchises (Cont’d) Pros: Valuable brand and proven operating system Safety and dependability Ability to purchase a pre-existing unit (no starting from scratch) Support service Cons: Difficult approval process Less control – many rules of operation Expensive for individuals to start

Sample Sole Proprietorship #1 Franchise fee - $42,000 Total investment - $438,000 (build, equip, and stock your store) Average store earnings - $381,000 High operating cost: absentee ownership not allowed; 15 employees per unit required Expensive product - $4/scoop

Sample Sole Proprietorship #2 Franchise fee - $15,000 Total investment - $310,000 Average store earnings - $80,000 High operating cost: absentee ownership not allowed; employees per unit required Cash liquidity requirement - Minimum $80K 20-year term operating contract

Top 10 Franchises for Hampton Hotels ($3.7M - $13.52M) 2. Subway ($85K - $260K) 3. 7-Eleven Inc. ($30K - $1.64M) 4. Servpro ($133K - $181K) 5. Days Inn ($187K – $7M) 6. McDonald’s ($1M - $2.16M) 7. Denny’s Inc. ($1.18M - $2.4M) 8. H&R Block ($31K - $138K) 9. Pizza hut Inc. ($295K - $2.2M) 10. Dunkin’ Donuts ($374K - $1.6M)

2008 Franchise of the Year 7-Eleven Inc. Began as a Dallas-based ice cream store (open 7AM – 11PM) 5,580 stores in the U.S. 25,062 stores abroad A new store opens in the world every four hours Extensive support service – training, marketing, & operations

2012 Franchise of the Year The first Hampton Inn opened in Memphis, Tennessee in Hampton Inn was the first mid-price national hotel chain to begin offering a free continental breakfast and free local phone calls. In 1995, the Hampton brand introduced Hampton Inn & Suites, which consisted of two-room suite hotel rooms with living rooms and kitchen areas hotels in the U.S. – plans to expand worldwide. Now acquired by Hilton Worldwide (which has hotels in 84 countries).