Considering throwing over your corporate career, investing a chunk of your life’s savings, and diving into a business that’s new to you and your family?
Feeling a little freaked out?
Of course you are. These are intimidating and significant life decisions. You’d be crazy to not be a little scared.
But there’s a difference between healthy fear and paralyzing fear. One is productive—driving you to investigate, learn and make informed assessments. One is destructive—leading you down a path of anxiety, inaction and frustration.
Emerson wrote that knowledge is the antidote to fear, and that’s a simple, ageless truth in franchising and in everything else. When you know the facts and understand your options, what’s left is solid research and understanding.
Regardless of whether that understanding gives you the confidence to invest or reasons to hold off, it allows you to proceed without being crippled by an unknown and irrational boogeyman.
There are countless fears that can bubble up in the investment process, but the HIRE YOURSELF team has learned to classify them in four main categories: fear of change, fear of failure, fear of loss, and fear of family instability.
Let’s break them down one at a time, focusing on reasoned analysis instead of useless anxiety.
Change. Even when we want it, even when we can’t wait, it has a way of getting under our skin, hitting our nerves and driving us toward doubt. The changes that come with franchise investment are many and varied, but first and foremost in most candidates’ minds is how every aspect of career will shift.
Where you go, what you do, who you answer to, why you give it your all—each of these everyday life factors changes when you make a major career move. More often than not, one of the biggest reasons corporate executives stay in jobs they dislike, tolerate poor treatment, and bide their days until retirement is because of this fear factor.
They’re afraid to give up what seems to be secure income and reliable benefits (those so-called golden handcuffs) to tackle something riskier—even if the potential upside is significant.
There are two factors to keep in mind if you’re dealing with this fear. First: if you’re clinging to the corporate world for security, it’s time to take a hard look at just how secure your position is. Every day, as a result of factors as diverse as changing markets, mergers, downsizing, age bias and more, hard-working folks who thought their jobs were rock solid find themselves making new decisions not from positions of strength (weighing all options and choosing what they want), but from the disadvantage of having the rug pulled from beneath them.
Statistically, the older you get, the more vulnerable you are to layoffs and forced retirement, so don’t assume the corporate salary and perks you have today will still be on tap in another year or two.
Secondly, even if your job is secure, it’s possible to invest in a franchise and get your business up and running before cutting ties with your corporate job. Every day more options for semi-absentee investors come along, allowing hesitant candidates to have the best of both worlds.
While many still choose to go all in and leap from the corporate world, others opt to keep one foot in each universe until they feel confident enough in their franchise to let the “day job” go.
We’re conditioned to fear the unknown, and there are few decisions with more what if factors than making a significant investment. What if I choose the wrong business model? What if the economy takes a downturn? What if I take this giant leap and fall on my butt instead of sticking the landing?
There are so many emotions tied into this fear—among them doses of pessimism and all our insecurities. It’s easy to let this complex cocktail of feelings keep you in the status quo, even if it means you’ll always wonder, What if I’d tried?
When it comes to fear of failure, though, knowledge truly is power—and few investments offer more information at the outset than franchising opportunities. When you invest in a franchise, someone else has already put in the blood, sweat and tears (not to mention the funds) to prove the concept works. They’ve found a product or service people will pay for. They’ve figured out a delivery system. They’ve designed training and built support systems for their franchisees. They’ve done it all, made a go of it, and are looking for partners in their expansion.
As a franchise candidate, you have a high level of access to information about the concept, management team, marketing strategy, operations practices, and profitability. You have a partner who also has skin in the game. You’ll even be able to interview franchisees who’ve already taken the leap. That’s a lot of knowledge—far more than you’ll ever be able to gather in a ground up start-up.
Is there any way to take all the risk out of starting a business—to insulate yourself 100% against failure? No, there’s not.
Can you hedge your bets by partnering with a proven, polished entity? You bet. You can also look at franchise resales if starting something from scratch is scary.
Do your homework. Work with a knowledgeable franchise consultant. Ask questions. The more you know, the easier it is to put fears of failure to bed for good.
Fear of failure and fear of loss are inextricably tied together, but the fear of losing money is one that deserves to be addressed on its own. In order to invest in a franchise, you’ll likely have to tap into two kinds of resources: private assets and borrowed funds.
There are a lot of ways to pull together the necessary investment—everything from leveraging retirement and home equity to securing partners to borrowing straight from the franchisor. All of them can escalate fears of loss.
Once you’ve secured funds and made your investment, the first milestone is profitability. Achieving it shouldn’t be a mystery. You and your franchisor will have a sound business plan, a ramp-up period, and reliable data from other units to guide your way.
The second milestone, in most cases, is salary replacement. For a lot of candidates doing the math, this is where initial calculations sometimes end. As you face your fears of loss with research, though, you’ll quickly discover a critical X factor—the value of the business itself. Over time, a franchisee’s business becomes an asset in its own right. The asset value of the job you left behind is always $0. The asset value of your franchise unit can quickly exceed your initial investment and become a significant nest egg for your future.
Starting a business is a whole-family endeavor. If you’re worried that making the move might put a strain on yours or pull you and your partner apart, it’s time to examine the possibilities and pitfalls together.
What are your short-term goals in terms of income and schedule and contributions of each family member? What are your long-term goals?
Many franchise candidates first consider this investment option because they are fed up with long, thankless hours in the corporate world. They want to set their own schedules, making more time for spouses and kids and themselves. The HIRE YOURSELF consultants have each been down this road and arrived, in the end, at solid investments that came with flexible work hours and room to make family a priority.
The most important thing you can do to allay any fears for your family during the process of franchise investigation is include them in the process. Remember, knowledge is the antidote to fear. Share it liberally with your partner so you can both feel confident in your decisions.
Ready to talk through your own franchising fear factor? Schedule a call with the HIRE YOURSELF t