Monthly Archives: October 2012

For a Solid Franchise Sector Look to Home Care


BY ED TEIXEIRA | October 23, 2012

When individuals consider a franchise opportunity the starting point should be to choose an industry that they are comfortable with. The decision should also be based upon the available investment capital and business skills that one possesses. Some individuals prefer fast food while others may gravitate towards children’s services. With over 2,500 franchises to choose from the task can appear daunting. However, for those who prefer the service industry, a home care franchise offers a solid opportunity.

Operating a home care franchise like other franchise businesses has its challenges. Dealing with people who have mental and physical ailments and managing caregivers is something many people don’t want to deal with. However, operating a home care franchise can be a rewarding and satisfying business.

There are a variety of services that home care franchises provide. This allows an individual to choose among franchises that offer non-skilled and skilled home care services. Franchises like Interim Healthcare and Homewatch Caregivers offer both skilled and non-skilled home care services. If there is a preference to provide only non-skilled services then a franchise like Comfort Keepers could be the right choice.

There are numerous benefits that a home care franchise provides:

  • Home care services are in demand and the market will continue to grow. Home care is one of the fastest growing segments of the healthcare industry. There’s no need to be concerned about home care being a trendy industry.
  • Almost half of the home care franchisors allow the franchisee to operate from a home based office. This means that the initial investment can be as low as $50,000 or less including the franchise fee. This provides an opportunity for someone who is attracted to a home care franchise but has limited capital to invest.
  • A home care franchise operation is clean and the work schedule is manageable versus some franchises that require long hours seven days a week.
  • For home care workers the labor pool is large and many seniors or retirees find the work rewarding.
  • Since the market for home care services is large there are ample territories available throughout the United States.

The home care franchise sector offers individuals a franchise opportunity with positive features that can represent a solid opportunity.

About Ed Teixeira

Ed Teixeira, President of FranchiseKnowHow is the author of Home Care Franchise Industry Update 2012. Click here to download a free copy. Ed has spent over 33 years in the franchise industry, including 15 years in the franchised home healthcare sector, where he served as a senior executive for a publicly traded home care franchisor as well as franchisee of a multi-million dollar home care operation. He was also Chief Operating Officer of a franchised medical staffing company. He can be contacted at 631-246-5782 or franchiseknowhow@gmail.com

Is It Too Late To Buy A Coffee Franchise?


BY BILL BRADLEY | October 17, 2012

The answer to the question, most certainly, may depend on your community demographic i.e. number of specialty coffee franchises and/or businesses in your desired location. It may even depend on your willingness to compete against the dominant Starbucks brand around the corner. Did you know Starbucks has almost 13,000 stores in the United States alone?

It is apparent, the coffee industry as of 2012, is highly competitive. Almost everywhere you look, whether its in a coffee shop or a fast food restaurant, a 7-Eleven, a donut shop or even a gas station, coffee is being sold to consumers. The good news is that 54% of Americans over the age of 18 drink coffee everyday.

Coffee Drinking Statistics:

  • Average price for cup of brewed coffee – $1.38
  • Total amount of cups of coffee (9 ounces) a coffee drinker consumes daily – 3.1 cups
  • Total average of money spent on coffee each year by coffee drinker – $164.71
  • Total number of U.S. daily coffee drinkers – 100 million
  • Total number of U.S. daily coffee drinkers who drink specialty beverages (lattes, cappuccinos, mochas, etc.) – 30 million
  • Total percentage of coffee drinkers who drink 13 or more cups of coffee each week – 24%
  • Total amount of yearly money spent on specialty coffee in the U.S. – $18 billion

Source: Live Sciene, Coffee 4 Dummies, Coffee Research
Date Verified: 7.31.2012

Are Coffee Franchises Recession-Resistant?

Despite rising coffee prices and a recession beginning in 2008, coffee sales continue to stay pretty stable. In fact, The State of the Coffee Service Industry Report in the 12-month period ending in July of 2011 found aggregate sales rebounded from a 10 percentage point decline in the prior two years by five points in 2011, driven by product price increases. The 2010/2011 report found an unprecedented 88 percent of operators raised prices in the 12-month period. So, there is no doubt the demand for coffee as compared to other food products in an economic downturn is quite consistent.

The National Coffee Association (NCA) annual coffee trends study also indicates coffee consumption held study during the recession. In 2011, the study found 40 percent of those 18 to 24 years old said they drink coffee daily, up from 31 percent in 2010 and on par with 2009’s 40 percent. For those 25 to 39 years old, 54 percent said they drink coffee daily, up from 44 percent in 2010 and ahead of 2009’s 53 percent.

Examining Today’s Coffee Entrepreneur

Coffee franchise owners, as a whole, are more professional, more sophisticated entrepreneurs than we have seen in the past. The mom and pop operators, for the most part, are a vision of the past. The new coffee entrepreneur is more in tune with his customer needs while displaying advanced delivery systems for a wide variety of coffee products that meet the tastes of the customer. Today’s coffee entrepreneur is ROI aware, making profitable choices when it comes to serving specialty coffees at least 15 hours everyday.

Coffee franchises offer proven business models including advanced delivery systems and an array of in demand coffee drinks that meet customer desires. They offer a complete package that includes an operating system, marketing programs and assistance with store location and design.

Preview some of our coffee franchise opportunities and complete the no-obligation form on the overview to receive more detailed information about owning a coffee franchise business.

DOES A FRANCHISE FIT INTO YOUR INVESTMENT PORTFOLIO?

Marc Kiekenapp PicBY MARC KIEKENAPP | October 10, 2012

If you’re considering an investment in a franchise business, think of it as you would adding a stock to your financial portfolio. I would suggest a meeting with your CPA or business attorney to see how a franchise fits into your overall investment package.

As most of us know financial consultants are conservative in nature especially when discussing long term commitments of your time and energy. Buying a franchise will undoubtedly require a good percentage of your financial allocation, so a informed opinion is required. Discuss with them your plan and the amount of funds to invest in a franchise so you have a good sound financial plan moving forward. This is the most important step in the process. You need to feel comfortable with the investment level and look at it as an investment in the future not an overnight success. There are literally 100’s of top franchises available that fall into that $50,000 to $100,000 category. There is a misconception among franchise seekers that if you don’t invest hundreds of thousands of dollars that it is not a good franchise opportunity! That is far from the truth and many of the most profitable franchises require less than $100,000.

Leveraging your liquid cash is a consideration for many franchise business owners. The lending market is very tight today but there is money available for franchise investors with good credit scores and management backgrounds. There are many creative avenues for business funds today.

 

  • Retirement Fund Rollover Programs
  • Commercial Lines of Credit
  • SBA Loans
  • Conventional Lending
  • Franchisor Lending Programs

What type of franchise should I Investigate?

There are a variety of franchise opportunities available in almost every sector of business. It is important to select a franchise that operates during the hours you want to devote to the business and it should fit business skills that you’ve acquired during your professional career.

For instance, if your interested in a retail franchise or food or restaurant franchise, count on working 7 days a week, at least in the early going. You’ll need management skills to hire and supervise a food manager or a manager to oversee your retail franchise business.

Automotive franchises will require a commitment of 6 days a week and customer service skills as well as management expertise. A business franchise typically will require your attention 5 days a week and require some sales experience. Lastly, if you buy a home services business i.e. residential maid services or handyman franchise, you will be committing yourself to 5-6 days a week and need some customer service and management skills.

 

What are the typical steps when investigating a franchise opportunity?

Once you’ve decided on a franchise category and have determined how much money you are comfortable investing it is time to engage in discussions with top franchise companies. This should be a process of mutual investigation and a learning process for both you and the franchise company. It is as important for both parties to have a good match for the franchise system. Successful franchise owners find a franchise opportunity that fits their investment budget and their skill sets.

Steps in a typical Sales Qualification Process:

  • You request franchise information via the internet or phone
  • Franchise company will contact you via email or a phone call
  • You will have an initial conversation to discover if there is common interest in moving forward. The franchisor will ask you if the invest level is within your financial capabilities. It is important to share this information.
  • The Franchisor will send you a franchise information packet for you to review
  • A scheduled phone call or meeting will take place to review the information
  • If you have further interest you will be asked to complete a profile with background and financial information questions
  • Receive the Franchise Disclosure Document and review with the franchisor
  • Validation calls with existing franchise owners
  • Attend a discovery day or office visit at the franchise headquarters
  • Approval of the Franchisor and your acceptance or rejection
  • Agreements Signed

Once you begin this process you need to commit the time and effort to conduct your research properly. The franchisor will have designed a system for you to obtain vital information that will assist you in making a decision about the franchise opportunity. I believe it is important to look at 2 or 3 top franchise opportunities so you have a basis for comparison and can make an informed decision.

The franchisor will require that you disclose your financial information at the appropriate time. You should have prepared this in advance with your accountant or CPA and be able to supply this information to the franchisor in a timely manner. Once this exchange of information takes place you will be receiving confidential information about the franchise opportunity and have access to existing franchisees during the research process. The franchisees will be your biggest asset in the research process and will provide you with real world challenges and opportunities that are available within the franchise system.

Don’t rush or be rushed into a decision for franchise ownership. This will be one of the most important decisions of your life and should be a fun and enjoyable process.