Franchising has been characterized as a way for an individual to be in business without being alone. Instead of "reinventing the wheel," a franchise owner can take advantage of tested concepts as well as the franchiser's knowledge and guidance.
Franchise ownership is not a shortcut to success. It's up to the individual to commit finances, time and effort. It is important to weigh the pros and cons of franchising to make sure it's right for you.
According to the International Finance Association (IFA), franchised businesses are growing.
When researching franchises, ask about the required experience, if any, as well as the expected hours and personal commitment needed to run the business. You also should learn about the franchiser's background. For example, what is the company's track record and how are other franchisees in the system doing? The upfront cost of purchasing the franchise is crucial but also how much you will pay for the continuing right to operate the business and what products or services you will be required to purchase from the franchiser.
The "Franchising Basics" section of IFA's Web site, www.franchise.org, offers information including a searchable database of more than 1,200 franchise opportunities.
If you are considering applying for a loan backed by the U.S. Small Business Administration, visit its Web site, www.franchiseregistry.com. This lists names of franchise companies with a streamlined review process for loan applications. If the franchiser is not a registry participant, your loan application will be still be reviewed individually by the SBA or its lenders.
Stephen L. Rosenstein is co-chairman of the Greater Baltimore SCORE Chapter No. 3. Call 410-962-2233 to speak to a SCORE counselor or visit www.scorebaltimore.org. To send a question to SCORE, e-mail email@example.com.