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Log In / Register | Feb 9, 2012

Studies Show Registration Benefits Franchisors and Franchise Buyers

Posted Wed, 2008/09/17 - 14:13 by sas46
In a recent article about Australia's franchise law, the IFA wrote that they consider "mandatory registration to be archaic, costly and burdensome for both franchisors and government while providing no measurable public policy benefit to prospective franchisees."

Start Your Business in a Favorable Industry That You Know Well

Posted Mon, 2008/06/09 - 09:27 by sas46
Entrepreneurs won’t be successful if they try to start businesses in industries they don’t know.

Choosing the Right Industry Matters

Posted Fri, 2008/06/06 - 09:47 by sas46
Picking the right sector or industry is important to being successful in business because there are considerable differences across industry sectors in business failure rates.

Startup Failure Rates,The REAL Numbers

Posted Mon, 2008/05/26 - 20:47 by sas46

There is a huge amount of misinformation on the Web about new business failure rates that gets cited and reproduced all over the place and that’s a problem for a host of reasons.

Genes and Desire for New Sensations Might Influence Entrepreneurship

Posted Sun, 2008/04/20 - 15:48 by sas46

I recently examined how our genetic make up might influence whether or not we become entrepreneurs.

Myth of the Missing Minority Franchisee

Posted Wed, 2008/03/05 - 11:05 by sas46
Fact: Minorities Are Actually More Likely to Own a Franchise

image I was recently contacted by a reporter who asked me if franchisors really were making progress selling franchises to minorities. So I took a look at the U.S. Census’ data on the question. Much to my surprise, the data shows that the question of whether franchisors are making progress selling franchises to minorities is the wrong question. Minorities are actually disproportionately likely to own franchised outlets.

To show you what I mean, I have produced two charts from the data in the Census Bureau’s Survey of Business Owners – our government’s census of all businesses in existence in the United States at a point in time. The first chart shows the proportion of businesses owned by people of different races that are franchises. As the figure shows, all minority groups are higher than Whites in the portion of the businesses that they own that are franchises.

Americans Less Likely to Own Businesses

Posted Wed, 2008/02/13 - 10:43 by sas46
Work for Companies More During Vibrant Economic Times

The proportion of the U.S. population that is starting businesses is shrinking. Data from the Federal Reserve show that the proportion of America households that own a business declined from 14.2 percent in 1983 to 11.5 percent in 2004.

Data from the Small Business Administration shows that, on a per capita basis, the number of people starting companies that employ at least one person is lower today than it was in the early 1980s. And data from the Bureau of Labor Statistics shows that the proportion of the population outside agriculture that works for him or herself is only 58 percent of what it was in 1948.

The data make very clear that American’s are becoming less and less likely to start businesses every year. That’s a fact.

It’s also good news. Having fewer entrepreneurs means that we are experiencing economic growth. The more developed a country is, the fewer people work for themselves. And when the effect of the number of entrepreneurs is isolated from other factors, the evidence shows that increases in the number of people running their own businesses leads to reduced GDP growth.

The Unspoken Problem of Franchising: Undesirable Industries

Posted Fri, 2008/01/18 - 20:13 by sas46

 Franchising Tends To Take Place in the Least Desirable Industries for Entrepreneurs

A lot of ink has been spilled over the disadvantages of being a franchisee. But one thing that is rarely pointed out is that franchising, itself, may not be the culprit for poor performance of franchisees. Instead, many franchisees perform poorly because franchising tends to take place in the least desirable industries for entrepreneurs. How favorable industries are for start-ups accounts for a lot of the difference between entrepreneurs in their performance running new companies.

For franchisees the problem is that most franchising takes place in the industries that are least favorable to entrepreneurs. Take hotels and motels. Over the past 20+ years, computer and office equipment start-ups have been 840 times more likely than hotels and motels to make the Inc 500 list of the fastest growing private companies. You can easily buy a hotel or motel franchise, but there aren't many computer franchises. In fact, franchising is concentrated in the industry sectors with the highest business failure rates - retail and personal service. So the unspoken problem for franchisee performance is lousy industries for entrepreneurs.