How entrepreneurs can take the “sprouted seed” of an established business and make it grow…
Becoming a business owner is a noble and grand adventure. At times, this exploration into entrepreneurship will lead you to move beyond new business startup options and delve into a wider pool that becomes available when you expand your search to include established business for sale opportunities.
With the possibility of growing faster and already having a book of business that lays the foundation for such growth, some entrepreneurs are electing to purchase an existing business rather than starting up from scratch. In some cases, thriving, high-performing franchises with healthy revenue streams become available for sale when their owners elect to move on to the next phase of their lives after building it steadily during their original plan of 5 or 10 years at the helm. Opportunities such as these are among the most coveted businesses of choice for professionals of stature with capital to invest.
Of course, as a franchise owner, whether you choose a new location or an existing business opportunity, your rewards are less dependent on “new or existing” and more dependent on how much energy you are determined to put forth into the proven system your franchisor provides. As corporations are downsized and segments of the white-collar population find themselves laid off, a review of future career opportunities tends to expand beyond the next job. The consideration to buy a business that comes ready-made with a customer base, multiple potential revenue streams and a rooted market presence still requires you to roll up your sleeves and work for your profits, but it also has potential to provide a jump start on that new beginning you are looking for at this stage of your life or career.
Bring your preferences to the franchisor and measure the variables
Investing in an existing franchise opportunity can be a jumpstart of sorts, but whether it is a jumpstart towards profitability or failure is dependent on your own due diligence during the research phase. In truth, existing or new franchise opportunities are available to you and each offers distinct advantages. However, in order to fully analyze the health and value of the franchisor and its existing business, you really need to rely on experts to guide you. This means meeting directly with officers of the corporation as well as several active franchise owners willing to give you an insider’s perspective.
Ron Rubin, New England Regional Vice President for Minuteman Press International, is able to help potential entrepreneurs traverse the territory of existing franchise opportunity potential. He advises, “When buying an existing business, it is important to review the profit and loss statements for the last three years to help establish the correct price to offer the seller. It is equally important to analyze the potential that the business has. I have seen many businesses for sale that have an owner that wants to retire who has not been working on growing the business for the last number of years and a business like that has great potential for growth. It is particularly interesting when all the fixed costs are covered and a large percentage of the new business turns into profit.”
As a prospective buyer of an existing business, you need to be eager to not only maintain, but build upon the trust that may exist in the current customer base. Maintaining healthy relationships and preserving the value of that all-important goodwill means handling the change of ownership with great care and if you elect to become a franchise owner, you are in luck because the mentorship from your franchise leadership will help guide you through the transition.
Established and trusted franchisors are frequently able to arm you with experts versed not only in the business needs of your area, but also familiar with existing staff and able to advise on the best ways to approach day to day operations. This is an enormous edge provided by the right franchise opportunity because with the power of an effective marketing strategy and a dedication to the proven system in which you will be trained, it is very possible to get a great purchase price on an under-performing business and turn it around to your great benefit. In the world of franchising at the elite, industry-leading level, this has been done to impressive degrees many times before.
Nurturing well the sprouted seed that is an existing business pays off
Kenny Clark, owner of Minuteman Press in McKinney, TX, is a prime example of an entrepreneur who dug deep into researching his many options and came up with the best match for his goals and professional drive, purchasing an ill-performing franchise and transforming it into a rewarding business venture. He now operates a business that was pre-existing but run by a previous owner who did not follow the proven franchise system of operations and was less motivated to put the hard work necessary into growing the business. Kenny capitalized on this opportunity and fully engaged in the superior training provided to him by his franchisor which for Minuteman Press franchisees means top-notch training both prior to as well as after the time that he assumed command of his business. Today, he owns a Minuteman Press franchise that is running successfully and he has every intention to nurture its continued growth.
Kenny observes a few unique ways that his franchisor “has his back” in areas he knows other franchisors are not there for their franchisees. He shares, “At the end of the day the entry level cost to get a Minuteman Press store going was reasonable and cost less than most. The majority of franchises have the philosophy of ‘the more you make the more we take.’ Essentially, you are punished for having a successful franchise, but that is not the case with Minuteman Press International. Their royalty cap was the deciding factor for me in joining Minuteman. I am allowed to keep more of money and invest it back into the business as I see fit.”
By investing in an existing Minuteman Press franchise, Kenny Clark moved forward and realized his dream of becoming a business owner. It was a venture where he knew he could successfully apply his drive and also grow his business by following the franchise system. As a result, Kenny was able to create an ideal, thriving situation, and he is one of the many people who have demonstrated that there chance to achieve success as an entrepreneur by taking over the reins of an existing business.
Kenny Clark offers 5 key questions to answer when considering an existing business or franchise for sale opportunity:
1. Why does the owner want to sell … What is the real reason?
2. What is the physical condition of the business?
3. What is the potential for the company’s products and services? (What are customer characteristics and composition of client base, competitive analysis, etc.?)
4. What legal aspects must be considered?
5. Is the business financially sound? If not, do I have the skills to make it financially sound?
Jeff Robey, Florida Regional Vice-President for Minuteman Press International, is experienced when it comes to advising interested buyers on the advantages of becoming owners of an existing business. He is able to help prospects prepare a clear picture for themselves as they make vital decisions before taking the leap and investing in the most ideal franchise-for-sale opportunities. Jeff advises turning your attention to certain details, advising, “Buying an existing business requires examination of the financial data of the company. Getting the company’s tax returns and profit and loss statements is a good place to start. Examining the company’s obligations ((as you would be assuming them) is also very critical. Getting an asset list so you know what is included is also very important. As an officer of the number-one rated digital print, design and marketing franchise, I am always active in the role of guiding prospective buyers towards this type of information and more so they can make the best decision for their future success.”
Don’t miss your chance to hit the ground running
Franchising can be a rewarding adventure into the business realm with opportunities to thrive as an owner whether it is a new or existing franchise opportunity. If you are examining an existing business you may find that the chance to save time and money with a location that is already equipped and operating is attractive and for a variety of reasons, makes sense for you. Many go-getters choose to “hit the ground running” rather than starting from scratch. If, as a new business owner, you infuse an existing business with an enormous amount of enthusiasm, knowing that by the time you make your purchase you have secured the proper training and support from a solid franchise system, you will have created the framework for a potentially rewarding entrepreneurial experience that can build upon existing goodwill and a flowing revenue stream.
To learn more about joining the #1 rated Minuteman Press franchise family, call us at 1-800-645-3006 or simply fill out the contact form on this page.