Questions to ask before buying a franchise
- Do I understand and accept the responsibilities of owning my own business? Franchisers do provide proven systems, training and support. However, the franchisee must implement these systems and manage the business. This will mean long hours and hard work.
- Will I enjoy my business? Consider your role in the business, how it would look and its growth potential. Think about the hours and days the business would be open, how many employees you would want and who your customers would be.
- Am I willing to follow the franchiser’s system? You are paying a price to be a part of a franchise. It buys a brand name and standards to ensure your customers will experience the same high-quality standards in every unit of that franchise. Be very familiar with what the franchiser provides and ask yourself if you are willing to follow their procedures. If not, do not make an investment in a system you will not use.
- Do I have the personal attributes to be successful? Talk to successful franchisees in the business you are considering to determine whether you have similar qualities, such as being outgoing or highly organized.
- Can I afford the franchise? Be conservative. Businesses sometimes fail not because they are unsuccessful, but because the owner ran out of money before they became profitable.
- Do I have family support? Family members must know and accept the demands that business ownership will entail. Have them involved in every step.
Source: Adapted from FranNet’s “Road Map to Success” guide
Blair M. Nicol
Age: 37
Residence: Encinitas
Title: FranNet principal/consultant for San Diego County and Southern California since 1998
Career: master franchisee for Mail Boxes Etc./The UPS Store for San Diego County, 1989-97
Education: bachelor’s in business finance/real estate from Colorado State University
Family: wife, Kathryn; daughter, London; son, Greyson
Hobby: golf
Last books read: “The Tipping Point” by Malcolm Gladwell and “The Wealth Code” by Jason Vanclef
Online: frannet.com
Carlsbad resident Ron Chamberlain was looking for something to keep him busy after he retired from a job in the insurance business, so in 2006 he contacted Blair Nicol of FranNet for advice on buying a franchise.
After researching several options, Chamberlain decided to purchase the Sport Clips development rights for Southern California. Despite having no background in hair styling, he now owns seven salons and has developed another 17 through other franchisees in San Diego and Orange counties.
It’s considered a “semi-passive investment” because the owner doesn’t have day-to-day involvement in the stores. “We train the manager to run the store, we train them right and they basically run the store for us,” said Chamberlain, 57.
His seven stores employ more than 90 stylists. They specialize in hairstyles for men and boys and offer hot-towel treatments and scalp, neck and shoulder massages.
Chamberlain said the investment — about $150,000 per store to get the doors open, plus franchise fees — has helped make his retirement more comfortable.
“I couldn’t control my real estate investments, I couldn’t control the stock market. But I could control the MVP experience that people have in our stores,” he said.
His Carlsbad store was recognized last year by the franchise company as its best-performing store nationally.
Tanya Mannes • U-T
When most people think about franchises, they picture Subway sandwiches or McDonald’s french fries.
But there’s more to franchising than restaurants, says Blair Nicol, a Carlsbad-based consultant who specializes in matching laid-off executives with suitable “white-collar” franchises.
He describes his business, FranNet, as “the eHarmony of franchising” because it uses information about a client’s skills and desires to match him or her with a business opportunity that has worked elsewhere.
“Just as our clients are looking for the right business, the franchisers are looking for the right fits for their concepts, and we are the matchmaker,” Nicol said.
He’s paid on a commission basis by franchise companies, many of which offer office business models in sectors such as financial services and information technology. His typical client is between 45 and 55 years old, was laid off from a corporate job and has always dreamed of owning a business.
“I am able to help people achieve the American dream of owning their own business instead of working for ‘the man,’ ” he said.
Having overseen San Diego County franchises for the UPS Store and Mailboxes Etc., Nicol can attest to the value of using an established business model.
“The most entrepreneurial thing a person can do is start a business from scratch. My hat is off to those who attempt it,” Nicol said. “However, the vast majority of them do not succeed.”
Of course, franchises come with a price. Usually, those who wish to open a franchise must pay an initial fee as well as ongoing royalties to the franchiser, “but that is the cost for your improved chances of success,” he said.
More on franchising from Nicol:
Q: How did you get interested in franchising?
A: I was raised by my father (Rancho Santa Fe resident Kip Nicol) to never work for someone else … because you are helping that person achieve their goals and dreams, and not your own. In the mid-1980s, he got me involved in the family business as the master franchisee for Mail Boxes Etc., which became The UPS Store. … (Later on) I acquired the Southern California office for FranNet. Four years ago, along with business partners, I acquired the parent company for Carlsbad-based FranNet. We now have over 50 franchised offices in North America and are considering overseas development.
Q: What services do you offer as a FranNet consultant?
A: We have helped hundreds of career-transitioning executives here in San Diego — and thousands across the country — safely transition into business and franchise ownership. We help them find the business or franchise that is right for them and guide them through their research process, so they can make a safe and wise decision. Think of us as the eHarmony of franchising.
Q: What are the most popular franchised businesses nationally?
A: Food — but that is not where our clients buy. Our clients typically come from upper-level management, and the last thing they see themselves doing is making sandwiches or asking people if they would like to “super-size” a meal. Our clients typically purchase more of the business-to-business, white-collar types of business that most people do not even know are franchises.
Q: What are some of the most popular franchised businesses and the average investment required?
A: The top five franchises that our clients are purchasing here in San Diego are:
• Brightstar Healthcare (senior-care services), $120,000
• Speedpro Digital Imaging (light-manufacturing digital imaging), $200,000
• Sport Clips (passively run hair care for men and boys), $180,000
• ERA (expense analysis and financial services), $90,000
• CMIT Solutions (information technology solutions for commercial businesses), $80,000
• Focal Point Business Coaching (business coaching and consulting), $70,000
