2013 Marketing Trends

5 Reasons to Franchise in 2013

With the looming Mayan apocalypse safely behind us and the fiscal cliff just hours away, entrepreneurs are faced with tough decisions in 2013. Expanding your business during a tough economic climate might seem counter-intuitive.  However, you might be surprised to know that the chaos and uncertainty of our nation’s future has created exactly the kind of environment where franchising becomes attractive.  In fact, while there are always great reasons to consider franchising, the following five reasons have been brought about or, at the very least, amplified by the global economic crisis.

Reason #1:  Downsizing and job loss has flooded the market with financially qualified candidates who are motivated and experienced. Obtaining capital through traditional third-party lenders is still difficult for start-ups. However, if your concept has a low barrier of entry, there are literally hundreds of thousands of franchise candidates out there who want to take control of their stability and livelihood.

Reason #2:  Smart entrepreneurs know that Franchises are a safer investment. While there is no guarantee that any business will succeed, smart investors are putting their money into brands and concepts that have a proven track record and a history of success.  A proven business model is also much more likely to be approved by the SBA or other lenders.

Reason #3:  Expansion through franchising risks less of your money.  If your business has a startup cost of $150,000, you will need nearly a million dollars to open six more locations. However, you could invest $150,000 into franchising your concept instead.  If your franchise fee is at least $25000, you will recoup that investment on your first six and will then have the same number of locations open and generating revenue.

Reason #4:  Pay less taxes.  The tax code isn’t based around whether you are self-employed or not. However, business owners are able to deduct many of the expenses that are not deductible if you are an employee. Cell phones, computer equipment, travel, vehicles etc etc. With the fiscal cliff fast approaching, many who are under-employeed or un-employed are already looking for income streams with more lucrative deductions.

Reason #5: The franchise community takes care of its own. You might be surprised to find out that those within the franchise community are very supportive and helpful to others in the industry. Even competitors work together because they know that protecting their segment is protecting their longevity. The International Franchise Association is full of mentors and experienced franchisors who are more than willing to lend helpful insight to emerging and/or struggling concepts.

So with impending doom of Apophis not a concern until 2029,  look for the opportunity within all this chaos and seize your chance to actualize the potential of your business…even in the face of adversity.

About the Author: Tra Williams is a Certified Franchise Executive and Managing Partner of Eastbourne Brands. He can be reached at Tra@EastbourneBrands.com.