For some, a franchise is an option
By Abha Bhattarai,
It took just a couple of days of retirement for Bill McGlynn, a former State Department employee, to decide it was time for something new — perhaps a franchise.
McGlynn joined about 60 people — some military veterans, others who had been laid off or were worried about job security — at a workshop at the Reston Association, a homeowners group, for those interested in purchasing a franchise.
The number of attendees at the Capital Area Franchise Fair has doubled in the past year, fueled in part by worries about sequestration and looming government budget cuts that could lead to widespread job losses, according to Heather Rosen, a franchise business consultant who runs the sessions.
“I’m getting more and more calls from people who are in a job but because of the ‘fiscal cliff’ are thinking, ‘Maybe I should find something else,’” she said.
Rosen, who works for FranNet of Virginia, briefed the roomful of attendees on different types of franchises (everything from cleaning services to fast food) and their associated start-up costs (from $25,000 to more than $500,000).
“There’s no one-size fits all,” she said. “You’ve got to be prepared, those first couple of years, to smooth out all the bumps.”
Representatives from the Virginia Department of Business Assistance and the nonprofit SCORE answered questions, as did local franchise lawyers. Companies such as SportsClips, a hair salon for men, and Zoup!, a chain of fast-food soup establishments, set up information booths.
Gayle Longmore, director of franchise development at Senior Helpers, an in-home elder care company, was one of the exhibitors.
“There’s been a huge increase over the last couple of years,” she said. “Whenever the economy goes down, people start looking for new opportunities.”
The average cost to purchase and set-up a Senior Helpers franchise falls between $75,000 and $98,000, she said, adding that more and more people are dipping into their 401k funds to get started.
“People have watched their [retirement] funds go away,” she said. “By flipping it into their own business, they feel like at least they have some control over it.”
Barry Lipsy, formerly chief marketing officer for Adventist HealthCare, also attended the workshop.
“My full-time job went away, and my brother was thinking maybe he and I should go into business together,” said Lipsy, who also once worked as a chief marketing officer for the U.S. Army.
Lipsy said he’s not entirely sure whether he’s going to buy a franchise. He’s looking at other options, including investing in a start-up.
“I’ve just started thinking about what else I can do,” he said.