Franchises Provide Solid Backing For Business Owners
By Kevin Smith© Pasadena Star-News, Saturday, April 4, 2004
When Subarshan Sharma moved from India to the San Gabriel Valley about 15 years ago, he didn't have much money.
But he had a clear vision of how he was going to earn a living. After careful research, the budding entrepreneur bought a Subway sandwich franchise for $7,500 - and he's never looked back.
In this country, 95 percent of the businesses are franchised,'' the 59-year-old Santa Fe Springs resident said. The company really helped me a lot - they wanted to expand fast and they worked hard to make sure I would succeed.''
As it turned out, Sharma's choice was not bad. In fact, Subway Restaurants has been rated the No. 1 franchise opportunity by Entrepreneur magazine for 12 of the past 16 years. But companies like Subway and McDonald's - the franchise names most people know - are not the only game in town. Jeff Johnson, founder of the Franchise Research Institute in Lincoln, Neb., said there are plenty of other opportunities out there.
There are 2,200 franchise opportunities in the nation that I know of,'' he said. But as to what type of franchise you get into, it's really a matter of fit. You need to match your interests and passions to what you want to do.''
Someone could have an interest in running a bakery, Johnson said, but the reality is they might not like the idea of getting up at 3 a.m. each day to put things in motion. Franchising appeals to many, Johnson said, because it allows them to build a business and still receive corporate support from the company.
It's tough for an entrepreneur who's out in the middle of the ocean trying to dream up what they want to do,'' he said. With a franchise you can use a track that's already been laid.'' Corporations like McDonald's and Subway also have big bucks to spend on advertising and that equates to instant name recognition for those who buy into their franchises, Johnson said. Gary Kaplan, president of Gary Kaplan & Associates, a national executive search firm based in Pasadena, agreed.
You want to buy in for the brand recognition and advertising support you'll get,'' he said. But you want to buy a business you'll enjoy doing. You wouldn't want to buy an insect extermination business if it's something you'd abhor doing.''
People who are looking to buy a franchise must also perform due diligence'' by thoroughly investigating the opportunity before jumping in, Kaplan said.
I owned a franchise in the employment services business a few year ago that specialized in the outplacement of IT professionals,'' he said. As I look back on it, I should have done more due diligence because the one I acquired didn't add a lot of value in terms of the type of business I was in.''
Johnson said some the best franchise opportunities are the ones that are not well known.
The best opportunities right now are the smaller regional chains that have 50 to 100 franchises,'' he said. They may not be on your radar screen right now, but they could be the next McDonald's. They have a unique niche and operating system that's just a better mousetrap.''
Johnson said handyman franchises and others that specialize in wireless technology using cellular phones, toys and other gadgets are also up-and-coming options to consider.
There's a franchise I'm researching now called Birds Unlimited,'' he said. They have retail outlets that specialize in all the items do with feeding and housing wild birds ... who would have ever thought of it?'' The Franchise Research Institute also maintains a Web site at FranSurvey.com that provides would-be franchisees with survey input from others who are already running franchises - including likes and dislikes about the ventures.
The Web site is helpful for those who are considering a particular franchise but want to find out more about it, Johnson said.
The bottom line is, anyone who is looking for a franchise wants to be part of a successful (organization),'' he said. If there are 100 other people out there who are already doing what you're hoping to do ... you have a lot less risk by seeing how those 100 people are doing.''
Sharma's 1,200-square-foot Subway store, at 16012 E. Arrow Highway in Irwindale, is doing well these days, he says.
The whole country is now liking all the healthy food, and all our foods are prepared fresh - nothing is fried,'' Sharma explained. Each day I get about 250 customers.''
