Blog Hotspot for Franchise News ...

In this week’s episode of Franchise Update, we are focusing on financial opportunities available to help fund the start up of a new business.

Click here to download this week’s Franchise Update, or watch in the player below:

Kiva, the entrepreneur lending site have announced a US pilot version. This will extend their current angel business lending facilities to entrepreneurs in Africa and South America to include entrepreneurs in the US. Visit Kiva’s website to find out more.

The SBA began accepting loans for a temporary new program called America’s Recovery Capital on June 15th.  “ARC” loans of up to $35,000 are available to provide a “bridge” for small businesses suffering financial difficulties to keep their businesses in operation until they get back on track. Visit the administration’s website to find out more.

For minorities looking to get a leg-up in the entrepreneurial world, franchising offers a fast track to self-employment. The success of franchises like Popeye’s Chicken in urban areas, not to mention somewhat related events, like the election of the first African-American president of the United States and the nomination of the first Hispanic woman to the Supreme Court underlines the great success minorities have been enjoying in business and politics in the last few years.

The IFA has recently published some very interesting first-hand accounts of the experiences of minorities in franchising. It makes for interesting reading and shows how a range of minorities, be they African-American, Hispanic or Chinese, are doing extremely well in franchising.

Take Serdar and Sujata Chakraborty, who  own three Wireless Zone franchises in Maryland. As the IFA writes:

For the past three years, the Chakrabortys have worked hard to reclaim the marketplace one customer at a time. Leading by example, the team has successfully maintained their managers’ and sales team’s dedication to servicing the customers. By treating, trusting and building relationships with their local Maryland communities, the Chakrabortys have been able to maintain a stronghold on the market as the leaders of three Verizon Wireless service and products franchises.

Or consider the story of Sam Hilo, whose family moved from Jordan to the US when he was 11 year old. Sam opened a Liberty Tax Service franchise in 2003 and now enjoys multiple trips in Europe every year.

“My first year in business I had the No.1 new office in the system. With a staff of eight, we prepared 1,340 returns and grossed $160,000 in revenues. I grew my business to eight offices in seven years without any outside financial help,” Sam said.

And there’s the experience of Ron and Patricia Ramsey, who aside from owning a Furniture Medic franchise, have been working tirelessly to advocate the benefits of entrepreneurship to citizens in Cleveland.

The Ramseys also spend time letting others know about the benefits of minority certification. They applied for the Minority Business Enterprise certification with the City of Cleveland, the city’s school board, the Ohio state government and Cuyahoga County in 2007. Minority certifications are important because government agencies and many large corporations are required to contract with a certain amount of minority and women-owned companies through supplier-diversity programs.

Reports like this show just how committed minorities are to succeeding as entrepreneurs. Owning your own business is part and parcel of the American dream, and this report highlights six people who have achieved it. Many franchisors may be unaware of this hunger to thrive in business, but it exists.

Meanwhile, minorities interested in franchising should stick with Franchise Direct. The entrepreneurs listed above all made their way in business with franchises that are part of the Franchise Direct network. There are a great number of exciting franchises for sale here.

What would you say is the ideal age to start a business?

A so-called millennial who came of age in the era of the internet might say 19 or 20. Just look the multi-billion dollar success that young entrepreneurs have enjoyed with Youtube and Facebook.

A more battle-hardened Gen X-er, who’s witnessed the rise and fall of the dot-com bubble might say 35 or 40. Ten or fifteen years of climbing the business ladder can expose you to some common management mistakes and protect you – and your investment – from the dangers of business naivete.

But a new school of thought is emerging that the best age to start a business is in your 50s. I know, it’s an age when most people are taking the long view and looking to firm up their retirement plan as the golden years loom, but an interesting story in Business Week magazine profiles a few Baby Boomers who have taken the plunge in entrepreneurship quite late in life.

The story quotes this eye-opening statistic from the AARP: “according to the nonprofit AARP Public Policy Institute, in 2008, 21% of the self-employed were between 55 and 64, while 10% were 65 and older.” As ever, the recession here is the key. While, in the past, many professionals approaching 60 might just hang on until retirement day, Baby Boomers, along with millenials, are often the first people in the firing line once the B-word - buyouts - is mentioned.

Forced by sheer necessity into business ownership, many seniors are finding entrepreneurship is its own fountain of youth, as Wally Blume, who started his business in his 60’s, says.

“I always wanted to go into business for myself when I was younger. But I didn’t have the money. At 61 if I was trying to get into a business that I didn’t understand and spent that kind of money, someone should have put me in a home. But I understood this business, and I saw its potential.”

For those Baby Boomers with business knowledge and the desire to relaunch their career, there are many great franchises for sale with Franchise Direct. Franchising gives one the same joys of business ownership, while eliminating many of the risks.

We’ve previously written about the possibilities available for Texans interested in owning a food franchise. New Jersey is another state that now seems to be warming to the financial potential available through franchising in this difficult economic market.

The Newark Star-Ledger has a new article on the expansion of franchising in the Garden State. In NJ alone, there are 20,000 franchise establishments, which are valued at about $25billion. As we have said over and over, finding funding remains a huge challenge, but if you have enough capital to get that business up and running,  there’s no limit to what you can achieve.

Take Rob Cox, who’s profiled in the story. At the height of the boom, Cox, a former trader, brought in $100,000 for his company Citigroup in one day. Cox took a buy-out from his company and is now about to open a frozen desserts franchise in Jersey City.  He hasn’t opened his doors yet and he’s already considering expansion.

“I have ambition,” he said. “I’m going to try to be number one in the nation.”

The story also speaks with Raj Patel, who worked in the automotive industry in the early-90s, only to see the writing on the wall. He turned to franchising and he and his wife Navina have owned and sold five Dunkin’ Donuts, a Blimpie and a McDonald’s. They’ve made profit every time.

Raj has now turned his focus to burritos. At peak hours, he is selling 150 burritos in an hour in his Mount Laurel store.

The bottom line, as ever, is that franchising works. New Jerseyan’s interested in a franchise opportunity need only follow this link to find the opportunity for them.

Can humans be born with the hard-wiring to be successful at franchising? Is it a genetic intelligence that makes some people more successful than others at running a small business? These are some of the questions that tantalize us. We were fascinated to read a recent article explaining why women are natural born franchisees.

Allbusiness.com recently ran an interview with Mary Ellen Sheets, who started her franchising career way back in 1989 with Two Men and a Truck. Sheets explains the secret to her success in franchising in this article, which seems to come down in some part to her gender. As author Carrie Brenner says:

Women are natural networkers, a skill that’s fundamental to becoming a successful franchisee. Being the new business owner in town, explains Sheets, means going out into the community to introduce yourself and attending events. Women tend to be good at networking within the business community and sustaining support systems with both men and women. Women with a nurturing side tend to excel at customer service — something on which a franchise’s success often depends.

An ability to manage people is also listed as a talent that many women bring to franchising. But before you female franchisees out there lose the run of yourself, Nikki Sells, a franchisee with Tasti D-Lite , lists one area that women franchisees can improve: finance. “Know how much money you have to invest, make sure your credit is really good, and make sure that you’ve got enough cash upfront to invest in the startup fees you need,” she says.

What do you think readers: are genetic predispositions towards franchising only exaggerating stereotypes or are they rooted in something real?