The millennial generation, today’s 19-34 year olds, is apparently a particularly “entrepreneurial bunch,” according to the Kauffman Foundation. In research completed in 2011, over 54% of the nation’s millennials said that they either wanted to start a business or had already started one.
Many dreaming of starting their own businesses already have their “Big Ideas.” They’ll start from scratch, building something brand new from the ground up. They’ll have many challenges in front of them: naming and branding their businesses, identifying viable markets, sourcing, developing pricing models, creating and implementing marketing campaigns, selecting the right mix of products and services to offer… and the list goes on. These start-from-scratch entrepreneurs will likely make lots of mistakes and adjustments along the way, but… that’s okay. They’re up for the challenge. The idea of creating something from nothing is too exciting to resist. They wouldn’t have it any other way.
Others, however, don’t have the same need to have the lightning bolt idea and incubate a brand new creation from the ground up. They’re ready to just start building. They, too, have the same drive to grow and build something, but… they don’t need to reinvent the wheel to get started. Give them a foundation to start with, and they’re ready to roll.
With so many people, apparently wanting to start so many businesses, we don’t all have to start from scratch.
There are other ways that will allow you to fulfill your entrepreneurial dreams without having to mastermind an entirely new business idea to get started.
Let’s take a look at a few of them:
Buy a Franchise
Franchising, according to Wikipedia, “is the practice of using another firm’s successful business model.” The franchisor is the supplier who allows an operator (the franchisee) to use the supplier’s trademark and market the suppliers goods. The franchisee pays the franchisor a fee (and often a percentage of the profits as well); in turn, the franchisor shares the wealth of information that is needed to run a successful franchise. The franchisee doesn’t have to worry about trying to figure out what products and services to sell, how to price them, who their target market is, how to source their products, etc. The franchisor, who is incented (by profit-sharing) by the franchisee’s success, is there to guide them every step of the way.
We know lots of players in this market already: Subway, McDonald’s, Chick-Fil-A… this is a concept that we’re pretty familiar with. We may not, however, know the extent of franchising opportunities available beyond some of those more recognizable names. There’s an entire world of franchise opportunities available beyond the fast food industry; from automotive services to consulting to pet care and senior care.
Buy a Business Opportunity or Distributorship
I’m going to define these types of opportunities loosely here. There are FTC regulations that make certain opportunities “officially” a business opportunity or distributorship; I’ll try to give an overview of these types of opportunities without getting into the legal aspects of each. For me, the easiest way to explain them is by comparing them to franchises. With a franchise, you will operate under the franchisor’s name. If you buy a fast-food franchise, for example, there’s no question: you will operate under the same name. When you buy a business opportunity or distributorship, you are buying the right to market / license someone else’s goods and services, but… you’re not necesssarily tied to running your business under someone else’s business model, like you would be with a franchise.
I’ll give an example from my own business: my consulting firm is a distributor for Profiles International. I chose the name of my company, LEGEND Talent Management, and I offer a mix of products and services. Among the products that I offer are assessment tools for small business owners to use in hiring, training and coaching their employees. I market the assessments under the Profiles name, but… I operate as my own entity. I don’t “answer” to Profiles in terms of how I run my business. I do agree to abide by certain terms and regulations regarding where I can and cannot do business and how the instruments must be used, but… there is a high degree of flexibility here for me in terms of how I choose to operate my company. In addition to providing me with quality products to sell, I also benefit from marketing and training support from a company with extensive resources. When you’re a small business owner, you quickly realize that everything you don’t have to do frees up more of your time to do what you do best.
Again, a host of business opportunities and distributorship options abound, serving almost all imaginable markets.
Buy an Existing Business for Sale
Finally, there is the option of buying an existing business for sale. Business owners have a multitude of reasons for selling their businesses, and obviously there are a number of questions that you’ll want to ask before assuming someone else’s business. The potential advantages of buying an existing business are many: customer base, established presence (either online or physical location – or both), instant cash flow, accounting records that can indicate buying trends and seasonal demands, existing trained staff (who you may or may not keep in the long run…!), and more!
In this scenario, you’ll have a history to learn from but will have the power to mold or “tweak” the business as needed over time to make it your own. This option provides yet another way to “jump in” and get going, continuing the building efforts of another entrepreneur who came before you and is now ready - for whatever reason – to step aside.
We’ll be looking at each of these options in greater depth with future posts. For today, we’ve just provided a sampling of the opportunities that will allow you to start your own business without having to start from scratch. There’s no “best” one; I have started one business from scratch and started another as a distributorship, and I can’t say one is better than the other. Your particular bent, your interests, your cash flow situation, your experience level, your family’s needs, and a number of other factors will influence the right decision for you.
The main message here?
Many roads can take you to the small business of your dreams… you just have to figure out the best one for you to travel.