It's the question that gets asked in every economic environment: Is now a good time to start a business? And the answer is always: Maybe.
On the plus side, banks are said to be loosening up small business lending, and the strong 2010 finish on Wall Street, coupled with better-than-expected holiday retail sales, seems to have bolstered the economic mood. Would-be and serial entrepreneurs who have been on the sidelines may be firing up their spreadsheets once again.
One path entrepreneurs may decide to take is franchising. After all, when you buy a franchise, you have the opportunity to accelerate your market entry through an already-created brand and operational system. One company that's pursuing franchising more aggressively is Jamba Juice, the smoothie and healthy foods restaurant chain that started out with corporately-owned locations but in the last few years has moved more into a franchise model.
James D. White, CEO of Jamba Juice, offers this advice to people considering a franchise: "Find a business you are passionate about."
Which is exactly the opposite of what you might hear from franchise consultants and brokers who often help potential entrepreneurs select a franchise. Consultants usually say something like this: "You're not going to be changing the muffler or making the sandwiches or cleaning the offices. You'll hire other people to do that. Focus on the business model, not whether a particular business concept turns you on."
White rejects that line of thinking.
Jamba wants franchisees who are "passionate about our transforming into a healthy lifestyle company. We want people who believe in that, who get the need for it."
What if you have deep pockets and the ability to run a multi-unit business but you like to eat pizza and ice cream and could stand to lose 30 pounds? Are you Jamba material? White notes that people who work at Jamba or aspire to own Jamba stores are interested in pursuing a healthy lifestyle, even if they're not there yet -- and that this passion is a filter for Jamba's consideration of franchise candidates. So you may need to adjust to all-fruit smoothies instead of McDonald's chocolate shakes if you want to make it in this concept.
Whether it's Jamba you're interested in or another concept, it's important that you not pursue franchising "out of desperation or as a last ditch, Hail Mary pass," White notes. You need to be disciplined and methodical. A few steps:
- Inventory your assets: Not just your financial ones -- but also your personal network, your community, your experience in business up to the present.
- Leverage your assets: Understand how you can leverage these strengths in a business you might start.
- Find the overlap of your assets with a franchise concept: There should be a heavy degree of similarity between your passions, interests and abilities and those of the concept or brand you're exploring.
- Have a team ready to go: Do you know where you'll find your key operatives to get your business launched? Have at least some of your team in mind before you commit.