FBR Issue 3 - 2018

FBR SPECIAL REPORT
Left: Lisa Price, owner and senior care advocate at FirstLight HomeCare, Columbia, SC
with one of her clients.
Right: Kurt and Melissa Godwin, owners of Mosquito Joe, Baltimore, MD.
A SMART FRANCHISE INVESTMENT
Ask any accountant or business owner for
their number one piece of advice, and you’re
likely to hear the expression “cash is king!”
It seems obvious, yet the number one reason
new businesses fail (including franchise businesses!)
is they run out of money. The biggest
benefit of investing in a low-cost franchise
opportunity is that with less money going to
fund fixed startup costs, you’ll hopefully have
more money to fund important operational
items that drive sales and cashflow.
When starting a new business, it’s easy to
spend, but you should resist the urge. Think
twice before making any purchases (even
small ones) as they can add up quickly. Whenever
possible, lease items instead of buying
them, and always consider used equipment
before getting something new. Spending $200
more to get that fancy new office printer, is
$200 less you’ll have to spend on advertising
or sales activities that actually drive revenue.
“We strive to keep our initial franchise
fee at an average or slightly below our entire
industry with much greater focus on owner
candidates having more of the working capital
they need to open and operate a successful
senior care business,” says Jeff Bevis, CEO of
FirstLight Home Care. “The primary benefit
here is to give our new owners an added
amount of working capital they can better
utilize vs. paying us more upfront.”
Running a lean and mean business gives
many owners of low-cost franchises a distinct
advantage in the marketplace. Without the
burden of high overhead, and the worries of
making large monthly debt payments, franchise
owners can breathe easy and focus on
sales and marketing.
Autumn Lew with Just Between Friends, a
top-rated low-cost franchise that specializes in
organizing consignment sale events explains,
“By keeping our startup costs under $45,000,
we are able to empower our franchisees to
start their own businesses without going deep
into debt. We help them to be good stewards of
their resources while building businesses that
serve the families and partnering non-profit
organizations in their communities.”
To help keep your startup costs low, talk
to franchise companies about potential discounts
or financing options that they may
provide. Some companies will let you finance
a portion of the initial franchise fees over time,
and many offer special incentives to military
veterans and other special groups such as
first responders. For example, Mosquito Joe
franchisees, Yoel Gutierrez and Omar Sanchez,
received a $2,500 discount on their South
Miami-based franchise because Sanchez had
previously worked as a firefighter.
BUILDING A SCALABLE BUSINESS
Just because many low-cost franchise businesses
start small, it doesn’t mean they stay
that way. In fact, it’s a common myth in
franchising that in order to grow a large,
successful business, you have to invest a lot
of money. Nothing could be further from the
truth. In fact, many of the low-cost franchises
on our awards list have much better return on
investment (ROI) than their more expensive
competitors.
“We provide a scalable business model that
will increase profits over time, by growing
revenue while avoiding cost increases,” says
America’s Swimming Pool Company CEO
Stewart Vernon. “Business ownership can
become more of a reality for hard-working,
middle-class Americans. Our affordable
startup costs give these men and women the
opportunity to make a more enjoyable life for
themselves and their families.”
Rita and Eric Blackwell of Spartanburg, SC
were looking for a good, low-cost franchise,
back in 2016, when they stumbled upon
Mosquito Joe, a franchise business that provides
mosquito control services. “We chose a
For more information on this report, visit: www.FranchiseBusinessReview.com | 13