6 Tips For Weathering the Storms of Entrepreneurship with Confidence
You have been dreaming of the day you would own your first business, and it has finally come. What the heck do you do next? We have all heard the chilling stats about business ownership. According to Zippia, 22% of small businesses fail within the first year. But the franchise space has less risk since many things have already been figured out for you.
According to The International Franchise Association’s 2023 Franchising Economic Outlook, the overall number of franchise establishments will increase by almost 15,000 units in 2023, or 1.9%, to 805,000 units in the U.S. This growth suggests that more people are turning to franchise ownership for a safer investment, but that does not mean it won’t be challenging. To help you navigate these challenges and keep your business on a steady course through the most difficult storms, consider these six tips.
1. Prepare for the Bank Drain
One of the biggest reasons for business failure is being undercapitalized. Everyone will have their hand out for money all at once, and yet you have no income rolling in. Be mindful, that depending on several factors, it could take months or even a year before you begin paying yourself a salary. Have that buffer already in place so you are not caught unaware and begin sinking.
2. Beware the Naysayers
Franchisee candidates of mine just announced their new business venture last month. Well-meaning friends and family asked why they purchased a franchise and why they couldn’t they just do it themselves. They replied that there is a built-in infrastructure already in place. They can text the franchisor with questions, have already made strong relationships with other franchisees, and have a business process that is already working to follow.
3. Set Up Shop with the Reputable Professionals
Just like a building structure, your new business needs a strong foundation. That foundation will support you and your business as you get up and running. Financial advisor, strategic CPA, business attorney, and a professional employer organization (PEO) are just a few of those key advisors that you need from the start. For example, a strategic CPA can help you formulate a proforma and really work the numbers to show when you can break even and begin paying yourself or when you can get your second location up and running. If you are trying to get around utilizing these professionals, you may get cracks in your foundation that could be irreparable.
4. Outsource What You Can
We cannot be great at everything. There are only 24 hours in a day. Getting inundated with minutia you do not enjoy or do not have time for will not serve you or your business well. Bookkeeping is a great example. You may know how to do it, but this is a job that is easy to delegate to someone else who probably will do a better job in the long run. This freed-up time will enable you to do other things that will benefit your business greatly.
5. Immerse Yourself into the Local Community
Last month, I wrote an article about the importance of networking. I cannot emphasize enough how critical this will be for the health of your business today and going forward. Meeting other business owners will be greatly helpful as you navigate this new arena. They will give you helpful tips about your local economy and mistakes to avoid.
6. Plug into the Franchise System
You purchased a franchise business for a reason. You wanted something that was already proven. Take advantage of the built-in brain trust. Speak to other franchisees often. Take part in monthly calls and work with your coach/mentor. This is not a sign of weakness; rather, it is strength in showing that you want your business to succeed.
Forge ahead with the knowledge that you are utilizing the right tools and making your foundation as strong as possible. Do not wait to sink before yelling for help. Take in the moments when things are going well and step back to revel in what you are building. Then get back to work and keep making it as strong as possible!
“I survived because the fire inside me burned brighter than the fire around me.” – Joshua Graham