Franchise Businesses - Why They Work - The E-Myth Review

Franchise businesses are successful for one reason: they have a proven system in place. That is why franchise businesses have a failure rate of only 25% within the first five years, and traditional businesses have a failure rate of about 80%. Quite a difference. Other facts according to 'The E-Myth' are: in the year 2000 there were 320,000 franchised businesses in 75 industries. Franchises produce $1 trillion in sales every year. Mc Donald's in particular is a $40 billion a year franchise with 28,707 restaurants worldwide that serves 43 million people a day.

The E-Myth states that the franchise, or turn-key business, is a way of running a business that 'has the power to dramatically transform a business from a condition of chaos and discord to a condition of order, excitement and continuous growth.' Why is this? It's because a franchise is a system-dependent business, not a person-dependent business. This means that as long as a person can simply follow directions, the business will most likely be a success. Ray Kroc was the first to realize this, and from this realization Mc Donald's was born. Since Mc Donald's is the most popular franchise recognized by people, and also the most successful, we will concentrate on the reasons that have made Mc Donald's 'the best' and what Ray Kroc did to create that model.

Ray Kroc's story begins with him walking into a hamburger stand with the intention of selling milkshake machines to the owners. What ended up happening was Ray observed a hamburger stand that ran like a 'swiss watch.' Hamburgers were produced 'quickly, efficiently, inexpensively and identically.' The method allowed anyone to be able to do it. He watched as high school kids efficiently and happily served customer after customer with minimal supervision from the owners. Ray convinced the brothers to let him franchise their system and 12 years later bought them out and created what is known today as Mc Donald's.

Even though franchises have been around for about 100 years, Ray Kroc's creation of Mc Donald's changed what a franchise was. A franchise used to be simply the right to sell a name brand product for a company and make some of the profit yourself. Ray changed that by making a franchise not only the right to sell the products, but also the right to use the proven system created for distributing the product. Ray's beliefs were different from original business owners. They believed that the name brand that you sell is what makes the business successful. Ray believed that it was the 'system' you use to sell a product that makes a business successful. In other words, he was 'selling' Mc Donald's itself, not just hamburgers. In Ray's opinion, a person looking to start a business didn't care if they were selling hamburgers or not, all they cared about was 'does the business work and make money.'

From that point on, franchising became a revolution. Franchise after franchise was opened, not only Mc Donald's, and not only in the food industry, but in almost every kind of industry in existence. Starting a business became as simple as thinking of a business you want, then finding a franchise that has created a proven system for running that kind of business.

To see other lucrative business opportunities that don't require the huge up-front capital and can be run online with automated systems visit http://www.AlternativesToFranchising.com

The Maids Franchise -Business Opportunity for 2010

Don’t have the time or energy after a hard days work to clean your entire house but aren’t sure someone else will do a good enough job for you. If so then The Maids, with their ‘22-step Healthy Touch Deep Cleaning System’ , may be the right way to go. And if your interested in owning a residential cleaning franchise then The Maids Home Service franchise is worth looking into.

Already an entrepreneurial success at the age of 21 with his janitorial company ‘Bishop Building Services’, Daniel Bishop created ‘The Maids’ in 1979 in Omaha, Nebraska. The Maids was so successful he was able to start franchising right away in 1980. What made it so successful? Well, the fact that he already had extensive cleaning experience and that he had researched cleaning processes. The research lead him to believe that the best way to clean was through team cleaning (teams of 4 people instead of 1 or 2) and helped him come up with his ‘22-step Healthy Touch Deep Cleaning System’ (which is a fancy way of saying we clean 22 places. Sink, range top, vacuum stairs, under bed, etc.) Even though the 22-step cleaning process isn’t a new technology or very original, the cleaning process is very detailed and more complete than most other services out there and concentrates on four main tasks; dusting, bathroom cleaning, kitchen cleaning and vacuuming. The Maids specialty claim is their extreme attention to detail and being thorough every time.

FACTS AND FIGURES

The Maids franchise has been featured in Entrepreneur magazine as the #1 residential cleaning franchise 2007-2009 and rated the fastest growing four years running. The company is still only located in the U.S. and Canada but has 1,027 franchises currently running.

The Maids as a franchisor wants the franchisee to work ‘on’ the business and not ‘in’ the business. This means the extensive 8 week training, mostly at the franchise location but some in Omaha, NE, will be focused more on how to run your crews and teach them the cleaning practices and other functions of the franchise rather than on teaching you to clean. The franchise will require about 2 full-time employees and 6 part-time. Each team of four will have a leader that is trained to direct the crew and double check to make sure all the work was done up to The Maids franchise standards. While passive ownership is allowed, which means the franchisee doesn’t need to be involved directly with the daily activities, it is discouraged.

The average total investment is $225,000 with an initial cash investment of between $100,000-$150,000. The Maids Franchisor expects you to have a net worth of at least $350,000. An initial franchise fee of over $10,000 is included in the total with an ongoing royalty of up to 6.9% plus 2% for advertising.

The Maids requires a building site that differs from most franchises. While the average franchise requires a free-standing building, The Maids requires a warehouse or light industrial site with about 1,000-1,200 square feet for the storage of equipment and vehicles. A corporate staff of about 35 will help with many of the necessary tasks needed to run the franchise. Tasks like advertising and marketing materials, data processing, equipment purchasing, training, inventory and an 800 help line are handled by the corporate staff.

To see other lucrative business opportunities that don't require the huge up-front capital and can be run online with automated systems visit http://www.alternativestofranchising.com/

Two Men and a Truck Franchise -Business Opportunity for 2010

Two Men And A Truck takes the worry out of moving. How? The fact that by 2005 Two Men And A Truck reached their 2 millionth move and that in 2008 alone 306,724 moves were done should alleviate some of those moving worries.

Two Men And A Truck was started in the 1980’s by two young brothers still in high school, Brig and Jon Sorber, as a way to earn some extra cash. The Two Men And A Truck logo that is so highly recognized today was drawn by their mother to use for advertising in weekly community newspapers. The brothers might have stopped moving when they left for college, but the calls from people looking for movers didn’t. So Mary Sheets, the brothers mom, decided to continue the moving business. She invested $350 into purchasing a 14 foot moving truck and hired a couple movers to continue the business. Mary earned a spot on the 1988 business panel at Michigan State University where a fellow panelist recommended she franchise her business. After talking it over with her lawyer she awarded her first franchise location in 1989. Two Men And A Truck has grown from that small family business to over 200 locations responsible for millions of moves.

FACTS AND FIGURES

Two Men And A Truck still remembers its small time beginnings and continues to implement the ‘Grandmother Rule’ which means treating everyone like you would want your grandmother to be treated. Two Men And A Truck is built on customer service and continually improves on its training’s. For example, Two Men And A Truck’s headquarters has a two-story house built in it with everything from grand pianos to china cabinets to bulky bedroom sets. This house is used to train franchisees how to properly pack, move, load the truck and do it as efficiently as possible. The house is loaded into a built to scale truck bed with clear sides so trainers can make sure everything is being loaded properly. How’s that for dedication to training! The initial training is 3 months and includes the hands on training, classroom training and detailed assistance all the way through the franchise’s opening.

Two Men And A Truck is the first and largest franchised local moving company and is recognized nationally. The average initial franchise fee is between $37,000 and $72,000 with and average total start-up cost of up to $407,200 which includes facility, trucks, equipment and other expenses. The ongoing royalties are 6% of the gross sales and 1% for advertising. Multiple locations are usually encouraged because once the thorough training’s have been completed its very easy to begin a new location.

Through the owner, Mary Ellen Sheets, Two Men And A Truck has always been very big on community service and charities. From the beginning, when Mary used the entire first years profits of only $1000 and split it up between 10 local charities, to the present where Two Men And A Truck donates 10 cents from every move to the American Cancer Society. The giving nature of Mary Sheets flows through to the rest of Two Men And A Truck’s franchisees where you see charitable actions such as donated moves, time and trucks for coat and toy drives during the holiday seasons and also much needed efforts during times of natural disaster.

To see other lucrative business opportunities that don't require the huge up-front capital and can be run online with automated systems visit http://www.AlternativesToFranchising.com

Kumon Franchise -Business Opportunity for 2010

Kumon is a unique educational system that teaches students how to master reading and math skills at their own pace. Kumon was started in 1954 by Toru Kumon. Toru was a japanese mathematics teacher that saw a need for a different teaching method because his son was having difficulty with math. The teaching method dubbed ‘The Kumon method’ was so successful that his son was able to do calculus by the end of sixth grade. With the help of his parents, Toru opened his first ‘Kumon Centre’ in Osaka, Japan in 1956. By 1958 he founded ‘Kumon Institute of Education’ and began opening locations around the world. Since opening there have been about 20 million students enrolled with about 4 million currently enrolled in 2009. Kumon has a huge presence worldwide with 1500 Kumon Centre’s in the U.S. and 26,000 centre’s worldwide.

What makes Kumon different? The biggest part is that students work at their own pace instead of with a class on a predetermined teaching pace. Also, the student must master each level of teaching before they move on to the next level, creating a strong foundation of comprehension and retention for the student. Since the student moves at his or her own pace and at a progression that is so gradual, they don’t get frustrated with the learning process. With the help of their instructors and simple daily assignments that teach them control and concentration, students will be headed down the path of the Kumon philosophy which is ‘There is nothing a child can’t do.’

Facts and Figures

Kumon is one of the few franchises that gives franchisee’s a feeling of rewarding work that benefits the community on top of making a secure financial future for themselves because it helps children realize their full potential and increases education in the community.

Even though Kumon has over 25,000 centre’s worldwide only 1500 centre’s are located in the U.S. making it a fairly small franchise in the states. The Kumon family owns a 60% share of the company, keeping it controlled by the family with the original teaching vision.

Franchisee’s can benefit from very modest start-up costs of $30k-$130k. Kumon is one of the largest and most established franchises in the world. Backing this estimation is a report from Forbes in 2009 that the entire company is worth over $1 billion. Kumon plans to open 120 new centre’s worldwide in 2009. The average total investment is usually about $50k with an ongoing royalty of $32-$36 per subject per month per student.

A staff of 1 full-time and 1-3 part-time employee’s is expected and a freestanding building or storefront in a strip center with 1000 square feet is needed. An initial contract term of 3 years is required with a renewal period of 5 years available after the initial 3 year term.

Kumon has a corporate staff of 400 that help with things like building site selection, advertising, grand openings, field training, inventory, 800 hotline help and other tasks. An 8 to 11 day training period is needed before opening a Kumon centre. There is even a quiz located on the Kumon website for people to take that may be interested in starting a Kumon centre.

To see other lucrative business opportunities that don't require the huge up-front capital and can be run online with automated systems visit http://www.AlternativesToFranchising.com

Jimmy John's Franchise -Business Opportunity for 2010

Jimmy John’s, known for its incredibly fast service and delivery time, was founded in 1983 by Jimmy John Liautaud. The story of Jimmy John’s beginnings goes something like this. After graduation second to last in his class of 1982 he had the choice of either going to the army or starting a business with $25,000 lent to him by his father. The deal was Jimmy would own 52% of the business and his father 48%. If the business tanked altogether Jimmy would join the army.

The original intention was to start a hot dog shop, but it turned out that it would cost nearly double what was lent to him, so he started a sandwich instead. Realizing that the big selling point with sandwich shops was the bread, he began baking his own bread in his mothers oven and buying quality meats from Dominick’s, a high end deli in the area. After coming up with half a dozen different sandwiches he had his family choose their favorite 4 and proceeded to open the first Jimmy John’s in a garage in Charleston Illinois on January 13th, 1983. Jimmy began with used equipment and no traditional marketing or advertising relying solely on offering samples of his four sandwiches and 25-cent cokes. His business began to thrive and he began catering more towards the college students of Eastern Illinois University. After a couple of friends backed out of positions as managers, Jimmy John was left to run the store by himself for a few years.

After buying out his fathers share in the business in 1985, he became sole owner and opened a second location in Macomb, Illinois. Jimmy ended up managing the second location himself after William “Billy” Burns died in a car accident. Jimmy John’s honored the memory of “Billy” with the “Billy Club” sandwich and can still be found on the menu today. Jimmy John’s continued to open locations and eventually developed a prototype store for franchising to begin in 1993.

Facts and Figures

Jimmy John’s has grown to over 875 locations with it’s headquarters located in Champaign, Illinois. Jimmy John’s believes in ‘true freshness’ meaning meats are not ground up bound with fillers and turned into tube meat which is what gives you the circle meat slices you see at most fast food sandwich shops.Meats are hand sliced at the store everyday. Also, vegetables are grown,packaged, shipped, and put on your sandwich keeping the vegetables fresh too.

Jimmy John’s used 16 stores and put together average numbers for their earnings. With an average gross income of $1,117,661 the franchises came out with an average net profit of $264,546. Not to bad for a sandwich joint.

A detailed list of costs for opening a Jimmy John’s can be found on their website with details like an initial franchise fee of $35,000 and an average initial investment of $304,500-$420,500 with ongoing franchise fees of about 10.5% for advertising and royalties.

To see other lucrative business opportunities that don't require the huge up-front capital and can be run online with automated systems visit http://www.AlternativesToFranchising.com

Jani-King Franchise -Business Opportunity for 2010

Jani-King’s story is a short but sweet one. While in college, Jim Cavanaugh was working nights at a hotel as an auditor. During this time he began talking with the cleaning contractor that came in with his crew at night. Through their conversations Jim realized the man was great at running his crew and always did a good job, but was unable to find new accounts during the day. Understanding the contractors weakness when it came to selling, Jim agreed to find new accounts for the contractor during the day. Jim was so successful at finding new accounts that he began his own business in 1969 and began the Jani-King franchise in 1974. Jani-King now operates internationally with over 13,000 franchises.

FACTS AND FIGURES

Jani-King is the worlds largest commercial cleaning franchisor with over 10,000 locations in 19 countries. Jani-King has been in Entrepreneur magazine ranked as the #1 commercial cleaning franchise, #2 for low-cost franchise and #1 home-based franchise. Jani-King is a great low cost franchise to start with small requirements like the franchisee net worth only needing to be between $3k-$33k and an average total investment of only $22k. Other benefits of the Jani-King franchise are low number of employees needed to run the business, no storefront or warehouse needed (which of course keeps costs low), the ability to run the business out of your own home and the fact that Jani-King is one of the few franchises that allows passive ownership, which means you don’t have to be directly involved with operations on a daily basis.

There is an ongoing royalty fee of about 10%. Jani-King requires a 20 year term contract with an optional renewable term of 20 years after the initial term is complete. Jani-King has a corporate staff of 65 to take care of tasks such as data processing, equipment purchasing, training’s, newsletters and an 800 help line. Jani-King gives a two week training to new franchisees at a local regional office which includes lectures, demonstrations, manuals, video tutorials and hands-on training. Jani-King’s advertising campaigns include being the official cleaning company of the PGA and the Champions Tours. Jani-King is also the primary sponsor of the Mike Garvey #17 Monte Carlo in the USAR Hooters Pro Cup Southern Division.

To see other lucrative business opportunities that don't require the huge up-front capital and can be run online with automated systems visit http://www.AlternativesToFranchising.com

Cartridge World Franchise - Business Opportunity for 2010

If your someone who uses your printer a lot then you are probably one of the many happy, money saving customers of Cartridge World. Cartridge World is an international company that originated in Australia with the name Australian Cartridge Co. but has since moved its headquarters to Emeryville, California, and changed its name in 1999. Cartridge World specializes in refilling and remanufacturing of ink cartridges for mostly personal home printers. The fact that their target consumers are residential customers can be seen in the choice of their locations, which are primarily in suburbs and inner city. Cartridge World was started in 1991 by Bryan Stokes and was joined several years later by Paul Wheeler. In 2004 the franchises were growing at a rate of nearly one store per day with a total of over 1,600 stores by 2009.

Cartridge World runs under independently owned franchise locations. Their main service is the refilling of ink cartridges using vacuum injection and manually repairing toner cartridges, but they also sell compatible cartridges and accessories for their customers. Cartridge World doesn’t require that the franchisee have any prior technical skills and offers up to 80 hours of training before opening a store. Cartridge world has had explosive growth and continues to grow as customers realize finally, that a refill service is available to them. The only hinderance of Cartridge Worlds growth is lawsuits from large print companies trying to stop the refill services and also new chips and other preventative measures being put into cartridges during their manufacturing.

Customers and franchisees both have reasons for loving Cartridge World. Besides the the cost savings for the customers they also benefit from a 100% satisfaction guarantee and can help keep their community green by refilling instead of discarding old cartridges into landfills. Franchisees benefit from being associated with the largest refill retailer that has also been rated #1 in the industry, #13 for fastest growing and #33 overall by Entrepreneur Magazine. Cartridge World franchisees are not limited to only walk-in customers because of Cartridge Worlds sales driven by business to business efforts, professional networking, trade shows, local chamber of commerce, business referrals and community events. Only a small staff is required to run the store and employees usually have a higher retention rate than other franchises because of their specialized skills. Current owners can also receive discounted franchise fees when they open multiple locations, which promotes multi-unit development, which of course translates into more income for the franchisee.

FACTS AND FIGURES

Cartridge World has been franchising since 2002 and has stores in 47 states in the U.S. and is in 38 countries. Cartridge World expects the franchisee to have a net worth of at least $250,000 and a cash investment of $30,000. The average total investment is usually around $182,000 with an ongoing royalty fee fee of 6% and an advertising fee of 2%. A free standing building or store-front in a strip mall is preferred and needs to be at least 1,000 square feet. A 10 year initial contract length is required with a renewal contract term of 10 years available. A 2 week training is given in Emeryville, California and a 2 week in-store training. A corporate staff of 50 help with tasks such as site selection, lease negotiation, advertising, marketing materials (coupons, mailers, radio/tv ads, etc.), grand openings, inventory control, 800 help line and many other services.

To see other lucrative business opportunities that don't require the huge up-front capital and can be run online with automated systems visit http://www.AlternativesToFranchising.com