Home Based Franchises

[gregdavidson]

I'm looking for a franchise I can start up from home. The only one I know about at this moment is Jani-King. Any others you can think of?

[gregdavidson]

I actually found a full list of home-based franchises on Entrepreneur Magazine's website. Anybody heard of any of them?

http://www.entrepreneur.com/franchises/homebased/

[vangogh]

I looked at the top 10 and did a random click into the categories below that. None of the names sounded familiar to me, but that doesn't really mean much. I just never heard of them.

[DoctorTentonyya]

Hello,

I just read your post and I hope I'm not intruding but I have an excellent Home Based Opportunity for the right person.

Check us out at www.mrcleankitchen.com and then send me your questions and comments. I welcome them all.

The best part about our Distributorship program is that it's literally recession proof, initial start-up costs are small at this time, and the potential for growth is enormous. Besides that, our service is mandated by codes and standards so finding work isn't to hard at all.

We are offering job leads at www.bidstreetusa.com, company training, ongoing support and over 40 years of experience all wrapped up into one nice package.

Thanks for reading,

Joseph Bajner
President
Mr. Clean Kitchen

[pete]

Greg, I'm familiar with many of them. I see 6 or more in my area nearly daily.

They are all good companies, I'm sure. I do have a bit of a problem with the two tool companies, as I know more about them. The others may operate the same way.

The tool companies will only allow most franchisees only so much success, then they go looking for a new prospect to take over some of the current territory, leaving the franchisee who developed a good business with maybe 3/4 of a loaf. And, should he build it back up again, they may take even more from him.

Also, with the tool guys you end up carrying a considerable amount of Accounts Receivable in an industry where many of your customers may have "sand between their toes." It's easy to load a toolbox in a pickup and be 4 states away overnight.

Again, I don't know that to be true with the cleaning services, but it's something to watch out for.

More than anything, though, the most important factor is YOU! Even with major franchises like McDonalds, where they go through a rigorous screening process, some don't make it.

With the smaller franchises, you may not be as throughly screened and then find yourself in a business you are not really good at. Nothing personal, just in general.

Many do very well with franchises, but you almost have to look at it, particularly at the start, as having a regular job. You have got to act as if the company is your boss and you have to do things just as they suggest.

Being an independent thinker and thinking you have a better way is not how you become successful with a franchise. Being able to follow their plans and instructions is what makes you successful.

So, much depends on you and your personality.

There is no doubt in my mind I would not do well as a franchisee, because I'm going to do what I'm going to do. It's cost me a buck or two over the years, but it's also made me a few.
.

[Steve B]

I guess there is a place for franchises, but I know it isn't for me.

There are so many out there today that have almost zero name recognition - so, I just can't imagine you couldn't do just as well starting something from scratch without paying royalties to someone.

[Rzgdmfzi]

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[David Staub]

My brother is a manufacturer of gutter protection and is just in the process of launching a franchise program for installation of gutter and gutter covers (http://www.guttergenius.com/dealeropportunities.html) (the Franchise Disclosure Document is being finalized this week, hopefully). He has had dealers but is now moving to a franchised operation. It is home-based although you need somewhere to park the truck and store some inventory.

[Chaphychitali]

There are many, many different franchise opportunities. Because many of these are great opportunities it really depends on the person who signs up whether it will be something for them.

[gurdertamaduc]

When looking at a franchise, you need to be looking at ROI. So many franchises have a poor ROI and a poor break even point. I personally think the home based industry boom will allow most franchise prices to come down as the home based industry is recession proof and a lot more people are getting sick and tired of high franchise and royalty costs and more and more headaches in owning a franchise.

The key is finding a great product that has stand alone value, a simple sales system, and a comp plan worth at least $100k a year. Hopefully you find what you are looking for, like I have.

[gregdavidson]

I was actually reading in Entrepreneur Magazine about this franchise where you sell tools out of a big truck. Maybe you know who I'm talking about.

[pete]

Greg, if you read my post above it's about 2 of those tool truck companies. There is also a member here - toolman - who has one of those businesses.

It seems to me one of his most recent threads was about finding something else, or even worse (heaven forbid!) getting a real job.

Search "toolman" for more.

There are some guys who do OK at this, many more sort of come and go.

You end up carrying a lot of accounts receivables on your own. Florida is a right transient area, a lot of "here today, gone tomorrow", including your $ 2,000 or more toolbox that they still owe for. Many have more money invested in their tools than they have in home furnishings.
.

[AffiliateHookup]

Hey, did someone mention my name?

Yes, I have officially gone to work for someone else, so I probably don't belong here anymore. I am essentially being paid to operate someone else's business now, so maybe?

But I will give you some insight on the tool business, if you like.

The principal is that you purchase your product from the franchisor, which is how they make their money. You make a gross profit of between 30 and 35 percent.

Essentially, you sell product to professional technicians on a time basis. If you sell them an account of $100, you collect $20 per week until paid off. That is the backbone of the business.

Snap-on charges a franchise fee, and a percentage (I believe) where the other three big ones do not. For an initial investment, you have to purchase your truck, your inventory, and then you need some working capital to get your accounts receivable going. You figure a truck is going to cost $75,000 for a basic one to start, your initial inventory will be a package that the franchise dictates, which, depending on the franchise, will run from a low of $35,000, to a high of $75,000. You buy the package. Then, you should have working capital of $15,000 to build your receivables (at 30% gross, this will build you around $25,000 in receivables). Then, you should have $8 to $15K in other working capital to pay expenses, etc. while the business builds to make money.

Financing is available from any of the big four. Generally, you lease a truck from a leasing company familiar with these vehicles. Your start up inventory is either financed with the franchisor, or they have a relationship with a commercial bank who is familiar with the business model. Some of them will even finance your working capital, but most do require you to have a certain amount of your own to invest.

So, a guy is going to hit the road with his new "business. " He immediately has payments on his truck of around $1200 per month. His inventory payment is probably another $1000 or so per month. and then, figure in normal expenses, such as insurance, fuel, supplies, maintenance on the truck, and other incidentals, and you have expenses of around $2800 per month. At a 30 percent gross, you need to collect $4000 per month to pay your bills. That is easy enough to do, as a good toolman should be able to collect $5000 per week. So, no problem, right?

Not really. That just covers your debt service, and some expenses. Your insurance will be another $200 per month, and fuel will be close to $1000 per month. So now we have $4000 per month for expenses. $1000 per week. Given the 30 percent gross profit on your $5000 in collections per week, you now have $500 per week left over for yourself!

How do you improve this? You pay for a truck in cash, or an inventory. That helps the situation. One of the companies, I know, routinely requires only $8000 in personal capital, and many of their managers tell you to just borrow it from a friend for a day, to show a balance in the bank (this borders on fraud... no, it is fraud!) Collecting over the $5000 per week helps as well. You manage your receivables well. You need to have your money collected on a five week basis. If you collect $7000 per week (your income around $1100 per week on this), you should have $35,000 in receivables. You must set the expectations immediately for collections when you make the sale. That is the trickiest part. If that is done correctly, you have a shot.

But, what became a problem with me was, the fact that you are buying a job. You do not hire employees to do this (I know, buy multiple franchises... it doesn't work... run my numbers while paying someone else to work 60 plus hours per week and deliver the performance needed... it doesn't work.) You must be on the road, seeing the customers to make it work. There is no leverage in other people. There is really no leverage at all. You don't have a capital gain, as you have some inventory, a truck (that depreciates), and receivables that tend to dry up and blow away in a very short time if you are not on the road. You can never collect them down to zero (trust me, I know this).

I took a job working for someone else, where they pay me to manage a segment of their business with about 20 employees. In addition, I get a percentage of the profit. Plus, I have all of the benefits. And, I have none of my own money invested. The employees make me profit, and I can use that leverage. Remember, even when we work for others, we really are working for ourselves, selling our skills to the highest bidder.

I probably will own a business someday (I consider the tool business to be owning a job at the best, which is not the best scenario), but it will certainly be a business using full leverage. Consider carefully if the tool business is what you want to do.

Hope this helps.

[ericajones80]

great post craig thanks for the info.

[stadiastudio]

If you like talking about cars, then you may want to consider becoming an Automotive Consultant (http://www.AutoProfessionals.com). I'm in the process of redoing their website and it sounds like a really cool business opportunity for someone interested in owning their own business.

[chicagopressrelease]

Are there strong advantages to a home based franchise vs. a traditional franchise? I'd personally put more trust in something more traditional, myself.

[stadiastudio]

It depends entirely on the franchise. Some business models will certainly lend themselves to that personal touch that comes with having a home office. While others really require a more traditional setting as you suggested.

The car consulting business I mentioned, for example, doesn't really work well as a traditional business with an office et al. The consultants typically meet their clients at other dealerships, the clients home or office, or some other place and they utilize their mobile office far more than an office computer. In fact, I understand that they're all getting laptop stands now like you see in cop cars. :)

[jayrobinson15]

That's interesting, I am also interested in a home based franchise, and although there are benefits to the traditional style that can't really be duplicated in a home-based business, I think there is enough of a successful track record to follow and be profitable with in that business model.

[csteiner27]

Hi grnoldschool,

Thanks for the information....

[Smoke]

The question of home-based or traditional (I assume this means retail or office based) isn't really the right question. It isn't the right question because your success as a franchisee isn't going to depend on that answer.

The more valid questions are: 1) are you good at and do you enjoy business development (aka "sales") or would you prefer to rely on marketing to drive people to you and 2) what is your current financial capacity to invest in a business and 3) what are your short and long term goals for the business?

The answer to these three questions will objectively eliminate the wrong franchise for you and leave a selection of good options to begin to analyze. And by the way, this list could include traditional, home based or both types of franchises.

Anyone interested in buying any type of franchise would benefit from an independent third party to help them with this analysis and the decision on what to buy. Mistakes are made when the decision on what to invest in is made emotionally off of the skills of a great franchise sales person. Use a franchise consultant that isn't tied to a specific franchisor. There are lots of us out there.

[Brett.M]

I've also been looking for a good home based business/franchise for some time now. A friend of mine recently got involved in a home based business distributing a new candy product and she's been doing very well for herself. I think it's called Revive Nature's Energy Mint. I guess the company offers a business package which includes exclusive distributor's rights and custom vending machines that the mints are distributed through. I haven't got much info on it yet but I'll keep you posted as soon as I hear more.

[CEB]

There are several very good home-based franchises that I feature. As a Franchise Consultant (http://www.thefranchisingauthority.com/), My free services help clients sort through the thousands of opportunities available, only showing them the type of businesses that would be enjoyable and for which they feel qualified.

[Kirk Ward]

Why does it have to be a franchise? Seems to me that if you have the skills for service business, and you could start your own. The small business development Center at your local college can help you a lot on that. Entrepreneur magazine as a lot of start your own books that make excellent guides.

[wheaties03]

this home base business I just got into has been around since 1992. It's basically a business within a business. You have the potential to make from $300 a week up to $30,000 a week. The $30,000 is based off one person who makes 1.4 million a year off of this.

With market america, it's a residual income, which once you grow it, it doesn't stop. Much like multi-level marketing, where your progress helps everyone above you, at no time would anyone take the work away from you that you have done. If you need to reach a goal of 5000 in one week, you only make 1000, then that 1000 carries over until you do make that 5000. In no way does this screw you over which is awesome.

If anyone wants any more information on the comapany, check out http://www.marketamerica.com/dwheatley or contact me

[CEB]

Why does it have to be a franchise?

It doesn't have to be a franchise. My point is that franchising offers individuals the opportunity to be in business for themselves, but not by themselves. The franchisor is there to provide support with all the different functions of the business. They have seen the issues that can arise in their business and know how to deal with any problems effectively.

Prior to your opening, they provide extensive initial training and support so you’re well prepared to handle whatever comes. They can also provide advertising and marketing support to help build your business faster. The most significant benefit to franchising is the reduced level of risk. This comes from a franchise system’s proven method of doing business.

Having a recognizable "brand" is also a huge plus.

I thoroughly review all of these points with my clients as part of my free consulting services. (http://www.thefranchisingauthority.com)

[NormanJ]

If you are going to go with an energy mint why not go with a known mint like Foosh or Buzz Bites. They have been featured in the media and from very reputable people. You can find the vending machines (http://www.vendingsystems.com) for them from AVS

[bizbroker1]

You can find a number of franchises at home based businesses (http://www.homebasedbusinessesforsale.com)for sale that would make ideal home based business opportunities.

[TobiasHansson]

Agree to that! Wish you all of my luck with your new business! :)

[jackie_bizymoms]

Hi,

Why not try the following link which has a lot of facts and advice from world class franchise experts on starting your own business. The site has a franchise directory which I am sure you will find helpful.
http://bizymoms.com/experts/index.html

Wishing you all the best.

[jv17]

to be honest i learned a lot in this thread because i was also looking for a home based business..