CEO of Frannexus, award-winning franchise consultant and author of “Profits are Better Than Wages“.
Upheaval seems to be the new normal when it comes to this third decade of the 21st century. The pandemic has left people shaken and led many to reevaluate their jobs and more.
When it comes to employment, many are calling the latest unusual activity the “Great Resignation.” In August alone, more than 4 million workers quit their jobs, according to the U.S. Bureau of Labor Statistics, following months of already-high quit rates. To me, these record numbers indicate a shift in thinking, which might lead many to transition to being their own boss.
Motivations For Opening Your Own Business
Of course, just because millions of Americans are moving on from their current employer doesn’t mean that they all want to strike out on their own as entrepreneurs. So, what motivates someone to become a business owner?
Each year, Guidant Financial and the Small Business Trends Alliance survey America’s small-business owners. The 2021 survey revealed the motivations behind why these entrepreneurs decided to start their own businesses. The most common answer, with 29% of respondents, was that they were ready to be the boss. Seventeen percent were dissatisfied with their previous corporate environment, while another 16% had decided to pursue something they were passionate about.
For those who had already decided to open their own business, the survey found most (43%) were happy with their decision. Another 31% replied they were “somewhat happy.”
Shifting From Employee To Employer
Maybe Covid-19 has made you realize that working for a corporation is no longer satisfying. Perhaps you have decided it’s time to do something different. No matter your interest or motivation in owning your own business, it isn’t always easy to transition from being an employee to being the boss.
To start, think about your business’s purpose. While your initial motivation might have been to set your own schedule or make more money, those aren’t ideas that can sustain a business long term. Consider something that goes more profound. (Maybe you want to help address an unmet need or make people’s lives easier, for example.) Whatever you decide, it should be reflected in the actions of your business.
Next, make sure you take time to think about the strategic direction of your business. Working on day-to-day tasks isn’t enough when you are the one in charge. You have to start considering what your next move is to keep the business moving forward.
Finally, you must think about the return on investment of an action. Employees work on things for their company regardless of the size of the return. To get ahead as a business owner, you need to evaluate if the action or investment will get your company where you want it to go. Of course, remember that not all investments will give you immediate gratification. Sometimes it may take longer to achieve a payoff. This doesn’t mean that it was a bad investment; you just need to be playing the long game.
Building A Business That’s Right For You
If you’re thinking of starting your own business, you might be trying to decide if a franchise or a startup is the right path for you. As a franchise consultant, I’ve seen that if you have been considering starting your own business, a franchise can be a helpful way to shift from employee to employer. With a franchise, you have the opportunity to be your own boss with the full backing of the franchisor to guide you. Of course, a benefit of a startup is that you get to call all the shots, but you’re also on the hook for all the decisions. With a franchise, you have the option of building a business or starting with one that is fully operational from the first day.
But as with all things, there is a process you should go through before taking the leap. With franchising, in particular, you must first think about the franchise you are selecting. There are more options than ever. It would be best if you did your research. What industry are you interested in or could do well in your area? What brand aligns best with your goals? Do you want to be running things, or do you prefer to step back and hire a manager to handle daily operations? Answering these questions is just the beginning of your due diligence, which should include a thorough reading of the franchise agreement.
Next, be honest about your budget. Now is not the time to get in over your head financially. Find out the costs for your chosen franchise, from franchise fees to startup and operating expenses to what kind of salary you will need. Remember all the potential insurance, permits and taxes you will be responsible for as well. Once you have a realistic figure, you can decide if you can afford a franchise right now, if you need financing assistance or if you need to save for a bit longer.
Finally, consider the time you are willing to invest in your business. Getting a new franchise off the ground can be a full-time job. If you can’t leave your current employment yet, will you have the time and energy to make the new business a success in your off-hours? It is also important to discuss this with your family so they are clear on your time commitments while you’re establishing your new franchise.
If you’re burned out and ready to do something different, business ownership is something to consider. But don’t take the plunge and simply hope it works out. Once you’ve made the decision to move forward, envision your shift from employee to employer. Prepare your exit strategy, and plan for your future success. As they say, “You’re only one decision away from a completely different life.”