Jane Yao's Blog

Does A Franchise Meet Your Needs?

When you think of becoming a businessperson by making the transition from employee to Franchisee, you don’t generally think in terms of emotional fulfillment. However, in reality, the evaluation of emotional factors should play a significant role in making that final decision to join the world of the capitalist, or remain in the realm of employee.

Of course, every analysis should include the standard of comparing risk to return. It should include income projections, and cash flows. It should include the analysis of financing avenues, site selection alternatives, and many other objective criteria to lead to a final decision about becoming an entrepreneur. The course of due diligence should be driven by a systematic approach to each of these items.

However, in the end, assuming the objective criteria have been ticked off your list in a satisfactory fashion, it should boil down to emotional fulfillment. After all, we all have a right to be happy. That particular statement “we all have a right to be happy” has changed the course of my life on several occasions. It was one of those statements that was passed casually by an acquaintance over dinner one evening, and ignored by everyone at the table, except it hit me right in the heart. It stuck to me like red on a stop sign. As a result, I have made many important life decisions based on emotional criteria, in addition to objective criteria. If it doesn’t pass muster on both fronts then I look for a better course.

There are many employment situations that can meet your emotional needs, wants and desires. Of course, there are also many that do not, and cannot. A full examination of emotional criteria should include the analysis of several items, with the ultimate goal of determining whether your needs can be met by a job, or whether it is more likely they can be met by your own business.

Control Your Own Destiny

The degree of priority that this particular criterion holds for an individual is probably the single most important factor to consider before making the decision to strike out on your own. Just how important is it that you control day-to-day decisions about what you do, and where you do it. How important is it to you to know that you have ultimate control over whether you stay or whether you go at some point.

The reality is that it’s not really possible to control your own destiny with a job. Even the most important CEO’s must answer to the Board of Directors. In more traditional circumstances, when and where you travel, when you get promoted, how much you earn, and how long you keep your job are items that are simply not in your control. The boss, and his boss, and her boss, control those things. As we have seen, bosses change, as do Boards, and status quo is sent for a topsy-turvy spin. When, and if, those things happen, are generally not in the control of an employee.

As we have seen in recent years, decades really, right-sizing, down-sizing, out-sourcing, and severance packages are the norm of the employment world. The importance of these items, including the degree of control you require over them, should help guide you to your own comfort zone. In addition to a systematic approach to the objective items in making a decision to become an entrepreneur on your own, or to become a Franchisee in a good system, these emotional factors should be ticked off the list as well. Are you satisfied where you are? Can you achieve your goals and dreams in your current situation? Are you more likely to satisfy the need to control your results with your own business? How important is each criteria to you?

Did you have to travel over your son’s birthday? Did you have an expense disallowed unfairly? Is the likelihood high or low of the bronze (as opposed to golden) parachute at age 53, with a low chance of a comparable position in the job market? Did you get passed over for a promotion, did you have to work overtime through the Christmas holidays, did you miss your daughter’s volleyball tournament because you couldn’t get off early on Friday? If these things eat at you, perhaps a change in course is due. If you accept that these things go with the territory of employment, then change may not be necessary.

Of course, as you progress up the ladder of promotion, you gain some additional autonomy for these types of issues. However, you must also try to determine if that next rung also carries an additional risk of termination at some point.

On the other hand, will being in the business you are evaluating help solve the problems that are important to you? Will your business cause the same travel issues? Will the time demands, or strange hours of being a businessperson, be an advantage or disadvantage?

Evaluate these items honestly, and with as much empirical evidence as you can gather, along with the other control issues that matter to you. Then determine which situation meets your goals more appropriately. And determine how important that is to you. Then it’s time to move on to the next evaluation criteria.

If you always use the “I deserve to be happy” test with each criterion, and try to determine which scenario is most likely to get you closest to that goal, then you will know which column to tick. If you execute this exercise in a systematic fashion along with a systematic evaluation to the objective criteria, it will help to provide clarity for you in the decision-making process.

The exercise should then be repeated for a whole host of other emotional factors such as financial independence, day-to-day motivation, building an asset of value, appreciation for efforts, fair remuneration for results generated, free time for family & friends, community respect, recognition of achievements, and several others.

The bottom line is you’ve got to look at ROI, cash flow, the system of support, the value of building a brand, the marketplace, and all of the other objective criteria needed to make a proper decision. However, in addition, you also need to examine what you want out of life, and whether a Franchise will help you get there.

Dennis Schooley B.B.A., C.A.

If you are just starting a company and looking for funding, or looking for additional funding for growth, you will need to develop a traditional business plan. Creating a business plan is a business hurdle that entrepreneurs seem to dread. Do you do it yourself? Do you hire someone to do it? How do you get it done quickly, but without spending too much money on it? Will what you do yourself be adequate to get funding?

In this article I will discuss the pros and cons of do-it-yourself business planning versus having a business planning consultant do it for you or with you.

The Do It Yourself Business Plan

Particularly if you are seeking capital of less than $200,000, consider creating the plan yourself after taking a class or reading some books or getting some coaching for someone who has written successful business plans.

Consider taking a three-hour business planning class through SCORE or the local Small Business Development Center. Even if you decide afterwards not to write your own plan, you will have a much better idea of what you want out of the process and what to expect.

There are some good reasons for an entrepreneur to do the business plan:

• First of all, because you can. If you’ve read sample business plans and find their accounting jargon intimidating, you are not alone. But as long as you can clearly get your message across and have other people such as you accountant look at the plan before it goes to lenders or others, you can do this work yourself.
• It is in learning the business planning process that you develop analytical thinking skills necessary to run your business with an intimate understanding of your own business model. Going through the planning process is an invaluable business experience.
• You need to know the plan inside and out and really understand the variables involved. You are the one who will be asked the tough questions by potential investors or lenders, such as “What will you do if only half your expected revenue comes in?” or “What will you do if you find out that direct mail is not working for you as your primary marketing tool?”

Outsourcing the Business Plan Process

Entrepreneurs are fire fighters. One of the most important jobs of an entrepreneur is to manage time, and do those things that you are best skilled to do. Many entrepreneurs decide to hire someone else to do their business plans, often because they have an urgent need for the funding and can’t afford the learning curve to be able to develop a high-quality plan that will meet the needs of lenders or investors.

In addition, if your funding requirements are more than $500,000 my recommendation is to get some professional help with this project, even if you do some of it yourself.

Some reasons to consider hiring a consultant:

• It will get done! Business planning is done much faster with someone who knows the process. Every entrepreneur has good intentions about getting plans completed, but months later they still haven’t done all the work. Planning should be high priority work, but it is hard to get to when customer calls and employee problems require immediate attention. The sooner the plan is completed, the sooner funding can be attained. And the price of hiring the consultant will be small in comparison with the increases in growth and profitability of the business.
• It will get done in a way financial professionals will respect. Business planning is done better by someone who knows how finance people look at plans and what they will and won’t question. Once you’ve been through the business plan process many times, you know what it takes to get funding – what to emphasize and what to play down.
• The consultant’s objectivity will allow for non-emotionally-based projections and expectations for the business. A consultant will be much more objective in the process and question your assumptions, making it less likely that the business will have problems after the funding comes in.

No matter what, don’t let a business planning consultant talk you into putting any information into your plan that you aren’t comfortable with. If it doesn’t look right to you, it probably isn’t. It is your business, and you will be stuck with the plan long after you’ve paid the consultant’s bill. Make sure it is the plan that you want, one that matches your goals and objectives, and captures the way you look at business and the spirit of your company.

If you do decide to hire a business planning consultant, here are some of the important questions to ask to make sure you get the greatest value from your investment:

1. How many business plans have you written for my type of business? How many of them were funded?
2. How much time will you need of mine during the planning process?
3. When will the plan be completed, and how many drafts should I expect to see and have the opportunity to comment on?
4. Will you be writing the plan yourself or do you have associates who do the work with you?
5. Will there be an opportunity for you to present the plan or for me to present the plan to my other advisors before the final draft is done?
6. How do you work in collaboration with my partners and advisors so their input is taken into consideration during the writing of the plan?
7. Do you do the market research and the financial spreadsheets, or are those things done separately (and charged for separately)?
8. Does your price include revisions or customization for certain types of funding (to include different information needed by investors versus lenders)?
9. Does your price include coaching to prepare me to talk with lenders or make financing presentations?
10. Will I have an electronic version as well as a hard copy version of the final plan (so I can make changes later if I need to)?

The Optimum Solution: A Blended Approach

At best, the planning process should not be at either end of the spectrum, but squarely in the middle. In my experience, plans that win funding come from a true collaboration between a skilled consultant/facilitator and the entrepreneur’s team of employees and advisors.

A business planning consultant can act as a coach, first assessing the job to be done, and then recommending who is best to do it. The business plan should be a compilation of work between the vision and goals of the entrepreneur, the technical understanding and expertise of his or her accountant and other professionals, a consensus of employees or others, and the research and writing abilities of the business planning consultant. The consultant should meet with all parties involved, talk about what is needed for the plan, and use all the resources available to get the work done as quickly and cost effectively as possible. It is the consultant’s responsibility in the process to take all the pieces and make the final plan into a readable, accessible document that will stand up to investor/lender scrutiny.

My final caveats:

• Don’t pay more than a few thousand dollars for a plan unless you are looking for capital of well over $1 million. I have heard more than a few horror stories by people who have hired university professors assuming they are the experts (they aren’t) and paying tens of thousand of dollars for a poorly written or incomplete plan. Ask your banker for business planning consultant recommendations, or better yet, talk with someone who had a good experience having a business plan written for them. It is reasonable for a consultant to expect you to pay half of the fee up front and the other half at the completion of the plan. And you can’t hold the consultant responsible if you don’t get funding based on the plan – too much is based on your own credit and management skills.
• Don’t expect to get a finished plan that is a roadmap of everything you need to do to have a successful business. That isn’t the purpose of the business planning process. A traditional business plan is intended only to document your strategies for the business very briefly – but well enough to get funding. If you are hoping for something that will tell you how to market or how many people you need to hire, you will have to start with a deep strategic planning process, and probably buy lots of consulting time to get you going.
• Don’t expect a great a business plan from a poor business model. If your costs are too high to make your business profitable, the business planning process will help you discover that. Then it will be up to you to make the hard decisions about changing your costs structure to make the business work. The business planning consultant is a skilled professional, not a miracle worker. A good business plan can help you highlight your strengths and minimize your weaknesses, but it cannot make an unworkable business model into a thriving business.

And one final thought: Don’t go on to start a business or make changes in your current business if everything in the business planning process tells you it won’t work. Things don’t get better out in the real world if they don’t work on paper. Deal with the weaknesses – get more training, consider product redevelopment, or have a home-based business to reduce costs until you can sustain the rent for an office. Businesses fail finally because they’ve run out of money. If your plan tells you that you can’t make enough money to make the business work for the long run, pay attention to that reality.

Would you like to find the key that unlocks the

door to a gold-mine of online response, sales and

results for your business?

It seems obvious that you would be able to see what

the experts do differently when locating market

opportunities, finding out what people want and

quickly turning that into an online business generating

truckloads of cash.

The reality is YOU CAN’T!

While the secret is massive in it’s impact, it is so

subtle – so subtle that you are sure to miss it if you

don’t know what to look for.

Here’s the secret and a formula for using it right this

minute!

What is DESIRE?!

Now stay with me for just a minute.

Think about the last time you bought a magazine? Why

did you buy it? Was it to look better, fee better,

make money, save money, make your house look better,

take a step toward achieving a dream in your life?

How about the last time you purchased an ebook about

marketing? It wasn’t the desire to learn more about

marketing that led to open your wallet, it was the

DESIRE to discover something unique, something new that

would RESULT in more more money in your pocket resulting

in you being able to finally quit you job.

OK, that’s more like it. It’s all about the end result

you want to get – not about the steps, processes, formula

or information to get you there.

Information is a tool – a method of achieving an end.

It’s up to you to determine what that END result is and

continue to help your market achieve that end, without fail.

Now, let’s look at how this can help you achieve YOUR goals…

A NEW Way Of Researching Your Market!

You will hear from many online marketing experts that the

important part of researching your market is WHERE you look.

Nice try – but that’s NOT the whole story.

The real secret is How you research your market.

For instance, take a look at the headlines over at one of my

sites:

http://www.infoproductcreator.com

Now, I’ve tested over 20 headlines on this page before finding

this one that coverts at least 3X better than earlier versions.

The market for this product is aspiring online entrepreneurs,

writers, consultants and speakers who are already considering

writing infoproducts to achieve more freedom, control and

security in their lives.

So why does this page work?

First, this market is time constrained. They are struggling as

much with lack of time freedom as they are with lack of financial

freedom. Many of them have lost control in their lives, are too

dependent on one income stream and WANT to quickly solve this

problem.

Second, this market feels they have something to share and WANT

to know how to do that – they WANT the prestige and “fame” that

comes from releasing their own ebook or book.

Try reading the headline (both main heading and sub-heading).

Can you now see the main emotional “cues” that lead to the market

triggers I outline above.

Another Example!

Let’s try another market entirely!

Head over to:

Sit, Stay, Fetch right here:

http://www.sitstayfetch.net

What do you think is the biggest reason dog owners end up

paying for obedience training?

The answer is in the headline. What dog owners WANT is a way to

stop behaviour problems in their dogs. Why? Embarassment,

fear of someone getting hurt, pain of having to consider giving

up their beloved pet – all lead to a RABID desire for dog

training.

Bottom Line – Think DESIRE!

Will you do this for me?

Spend the next week looking at everything in terms of underlying

desire.

When you read the newspaper, speak with a collegue, watch TV, go

to a movie, speak with your spouse or your kids, read websites,

review ads, etc… think about the underlying desire. Why does

that communication exist as it does.

Carry a journal and quickly write down each event with it’s

corresponding, underlying desire.

IF you follow this exercise, you’ll not only be amazed at what you

come up with for “normal” daily communication, you will have

started down the path of thinking like the highest achieving

business people of all time. Not bad for a week’s effort?