Defense Media Network

Newest Defense Media Network Promotion

Buying a Franchise: How Soon?

Determining the best time to start a franchise

“A franchise owner is not like managing a part of a company, where you don’t have to understand every part of the business; in a franchise, you are in charge of everything. So working for a franchise for a while is a great idea – but at least work within that business sector.”

Miriam L. Brewer, director of education and diversity at the International Franchise Association (IFA), says another valuable resource for new veterans also mimics a familiar military tactic – debriefing others who already have “been there, done that.”

“While timing is a largely personal decision, the best help would come from other veterans who already have gone through the process,” she says, adding that waiting awhile, generally speaking, is neither an advantage nor a disadvantage, but somewhat akin to another major life choice and institution. “Going into a franchise is like getting married – you don’t just wake up one day and decide you’re going to get married, then go out and find somebody to marry.

“It is something on which you should take your time, make sure you do a lot of research and, when you think you’re finished researching, do some more research. That may include going to franchise expos, getting information from the FTC [Federal Trade Commission], SBA [U.S. Small Business Administration], VA [Department of Veterans Affairs], VetFran, IFA, and franchisor websites. People just need to do their homework; whether they wait a month, a year, or a decade, they must feel they are in the best position to make that move.”

And whether a specific veteran is ready is not entirely the veteran’s decision, she adds.

“The franchisor will have them fill out a questionnaire first that will help the franchisor determine if they are ready,” Brewer says.

But being ready means more than personal feeling or even satisfying a franchisor – or a spouse. It also requires obtaining financial backing for a new business.

“All the skills they learned in the military, from discipline and leadership to following systems, they will use every day in a franchise.”

“Someone with no food experience who wants to own a restaurant will find pretty much zero chance of getting a loan,” she warns. “So spending some time working in a restaurant to gain experience will help. And when you submit your application to the franchisor, you also will be a better fit for them.”

Chuck Southern, corporate relations officer at the VA’s Center for Veterans Enterprise (CVE), says CVE has found veterans considering franchising generally fall into three groups, largely based on age and military experience.

“The younger veterans, those in their 20s, come out after four to eight years with some requisite skills, may have finished a degree, can get a high-paying civilian job, have few financial obligations, and so can save. The second group, mostly in their 30s, exits after more time in the military and spends five to 10 years to stabilize and develop the resources needed,” he says.

“Finally, there are the older military veterans – in their 40s and 50s – who have served 20 years or more and are receiving retirement pay, which means they generally are in better financial condition, with equity in their home, kids often out of the house, and so may decide to go directly into a business of their own.”

Whatever the case, he adds, “The real rate of success is more dependent on preparation” – the key factor in everyone’s advice. But doing the necessary research, gaining a fuller understanding of civilian business and franchising, building the needed financial foundation, even taking courses in business or learning how to use financial software need not wait until after separation. The consensus is: As with any new command or deployment, the better the advance preparation, the greater the likelihood of success – especially when adding the unique advantage of military experience.

“All the skills they learned in the military, from discipline and leadership to following systems, they will use every day in a franchise. They are uniquely qualified to get up every morning and lead people to a common goal. So everyone from a sniper to a logistics officer learned things in the military that will make them a great match for a franchise,” Thompson concludes, adding the question of “how soon,” when all other factors are considered, remains a distinctly personal decision.

“It is as different as people. I’ve seen veterans who have been out for two years and others 15. It depends on where you are in your life and what you’re ready for. But this will be really hard work, so you really have to be ready for it. And I’ve never seen any two veterans alike in that respect. It’s a very personal decision. Just make sure you are the one who’s ready, because the key to owning your own business is you have to be the driver.”

Prev Page 1 2 Next Page

By

J.R. Wilson has been a full-time freelance writer, focusing primarily on aerospace, defense and high...