Everyone dreams of owning their own business. “Firing their boss,” “breaking through the glass ceiling,” “earning what they’re worth,” “building an equity,” and “taking charge of their financial future,” are all motivations commonly cited by people as they begin their search. Unfortunately, many never achieve their goal and spend their careers in unfulfilling jobs. They, and their families, suffer when their unhappiness and low income impacts the relationships they have with their spouse and children. I meet many of these searchers in their early stages and try to make them understand that the job of finding the right venture is a tough, time-consuming task. Just as finding an outstanding managerial job takes weeks to complete–reviewing marketing brochures, talking with salesmen and researching franchise opportunities takes weeks of dedicated study. Have you begun investing 10 hours a week to the project? (If you’re unemployed, it should be 40 hours.)

Too often, franchise buyers postpone making a decision, waiting to find the “perfect” business for them. Those that take the same approach to house hunting spend their lives in apartments. Very few things in life are perfect! When we’re buying a home, we may trade off the spacious family room in one house for the better school system associated with another. Similar concessions must be made when reviewing business ventures.

You need to get started on your entrepreneurial path NOW! Solve your financial needs and start building an equity today! DON’T expect to find the best business in the world for you–in all probability it will not be the only company you ever own. Most people run the same business for only 5 or 7 years and then hire a manager or sell it and move on to something bigger or more challenging.

Are you frozen at “home plate” just watching ads whiz by? Pick up the phone and call 5 to 10 companies for their marketing materials. (You’ve made it to first base.) Choose the three that you think will best fit your needs and fill out and submit the company’s “Qualification Form.” (This will open discussions with a sales representative and places you firmly on second base.) Now continue your research by closely reviewing the Franchise Offering Circulars sent to you, and visiting or calling as many franchisees as is reasonable. If you’re gaining a comfort level, you’re rounding third and should have an attorney or accountant review the agreement to be sure you fully understand it. When you’ve made the commitment to sign the license, join the franchise network and begin your entrepreneurial career, you’ve made it to home plate! The crowd (or at least your family and friends) are cheering, and you’re on your way!

Often you’ll have to repeat these steps because you get “stranded” on second or third base. But reading ads in a magazine and looking a dozens of franchisors’ web sites is no way to seriously approach the task!! Good Luck!!



Are you ready to be a winning franchisee?

On our Home Page, we recommend 14 books for your review. Have you taken entrepreneurship seriously enough to begin making improvements in you? Have you hired and managed people before? Most franchises will grow to the point of employing 3 to 30 employees and your responsibility will be to interview and hire winners and then motivate and manage them. These tasks may sound easy but most of us can learn better skills. Remember that dreadful bore you worked for a few years ago?

Do you know what to look for in a new employee? How do you coach them? Motivate them? Guide them in time management? Handle grievances? Terminate them? Are you confident all of these methods are still legal in your state?

Check with local sources for classes or check with Fred Pryor Seminars or Career Track Seminars, two national companies. The more you know about hiring and managing people, the better your franchise will run.



In this section we answer questions commonly posed by franchise buyers. To submit a Query, please E-Mail us.

Q. Can you explain “declining royalty” schedules?

A. Many progressive franchisors are now reviewing their franchise royalty schedules to reflect a more accurate balance of the franchisor/franchisee relationship. When a new unit is opened, the franchise owner may call headquarters daily with questions. A year later, the demands on head-quarters may drop to weekly contacts and by the second anniversary requests for help may drop to one or two a month. At the same time revenues continue to rise as the franchisee takes more responsibility for his own success.

Franchisors say that, “A franchisee who grosses $100,000 annually does so almost solely because of our system. One that grosses $1,000,000 does so because of their superb implementation of our system–while putting less demands on our headquarters staff. Therefore, we feel we should earn less of a percentage on the high-performer than the smaller operation.”

If you plan to be a top producer in any franchise network, a declining royalty structure will be a great advantage to your profitability.



Franchisors continue to recognize that communications with their franchisees is one of the most critical aspects of building a successful team. There’s nothing more frustrating for a franchisee than to learn of a new marketing idea, product or service approved by the franchisor that hasn’t been introduced in his area. Many successful companies are now using technology to spread the word. One franchise network with over 300 units sends an Owners’ Update email to every licensee each Wednesday.

Another service franchisor has developed its own proprietary “chat room” on the Internet where franchisees meet weekly to discuss common problems and solutions. A technology-based company with hundreds of products sends 2 or 3 emails weekly with new solutions to customer needs. Others are using video, CD or software-based presentation tools to help their licensees introduce new clients to their services and products. More HQ’s offer direct mail, telemarketing, accounting and other services to their networks.

The Franchise Doctor welcomes your comments: Click Here to Send us an Email or Call: 800-220-8256


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Jim Muelhausen
Jim MuelhausenPresident CEO Focus
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Jim Deitz is a true pleasure to deal with. He is forthright, honest, and hardworking. When I hired Jim I got what I expected: a knowledgeable franchise expert. However, I also got an invaluable member of our team whom I still rely on for great advice.

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