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What Exactly is the Difference Between a Traditional Franchise and a Turnkey Business?

A traditional franchise is a business in which authorization has been given to an entrepreneur to sell and/or distribute an established company’s goods or services in a particular area. The term “franchise” is also used to refer to a business or group of businesses that operate under such conditions.

With a traditional franchise, the franchisee—that’s the individual business owner—pays the franchisor—the corporation—a franchise fee for the right to use the franchisor’s name and business model. Start-up materials and ongoing support are often provided by the franchisor, but there are still many aspects of operating the business that are the responsibility of the franchisee.

A turnkey business, however, is one in which everything an entrepreneur requires to open a franchised unit is provided. The term “turnkey” comes from the idea that—using one of these packages—all one would have to do to open for business is “turn the key.”

Recently, the realm of Internet business has seen a boom in the number of turnkey websites. This is the same thing as a brick-and-mortar turnkey business with the exception that the business owner is being provided with a fully functional website versus a fully stocked store, for example.

Is Everything Really Included in a Turnkey Package?

In the truest sense of the word, yes. The franchisor would provide and do everything, including selecting and leasing your location and hiring your staff. In reality, however, you won’t find very many franchisors who will actually hire your employees.

But the franchisor offering a turnkey package will take care of most of what needs to be done in order to open your business. This can be a great advantage if you are new to franchising because it will save you hours upon hours of work and research.

Turnkey packages can also be an exercise in swindling, however, and you should do some research to find out what you’re getting into.

So, How Do I Choose the Right Turnkey Package?

The best way to research this is by asking existing franchisees. The main thing you’ll want to inquire about is whether the existing franchisees feel they got a good deal with the turnkey package. In other words, the franchisor shouldn’t be putting a high markup on the package components. Their income should be coming from royalty and franchise fees—not start-up costs for new franchisees.

If you don’t feel you can acquire adequate information from business owners who are already involved in your selected franchise, ask the franchisor if they are willing to provide you with a complete cost breakdown. You’ll also want to ask whether the labor involved in providing the package is a separate line item or factored into the cost of each component. If it is factored in, what is the markup percentage?

Take comfort, however, in the fact that the information you really want—whether or not you’re being ripped off—is fairly easy to come by. If a franchisor’s turnkey package has an exorbitant markup, the existing franchisees are going to be aware that they were had. And they will probably be more than willing to tell you about it.

What Are the Advantages of a Turnkey Business?

Because of the all-inclusive nature of the turnkey package, it is a fantastic opportunity for those budding entrepreneurs who may not have the knowledge base of a veteran franchisee. And, even if you are very business savvy, a turnkey package saves you the time and effort involved in starting a company from the ground up, i.e.: developing a successful business plan, choosing and leasing a location, purchasing inventory, hiring employees, etc.

Although the initial investment for a turnkey business may be a little more than a traditional franchise, the rewards for that investment are substantial. You’re buying into a brand—perhaps one with which consumers are already familiar. There are certain restaurant chains, for example, that you know are not going to go under. People will always want burgers and ice cream. This substantially lowers the risk to you, the franchisee, by allowing you to utilize a proven business model.

A turnkey business will also save on the time it takes to open your doors over a traditional franchise because most of the start-up issues will be addressed for you.

Final Thoughts

As with any business venture, a turnkey business opportunity does represent a certain amount of risk—even if that risk is smaller than other types of businesses, so do your research. Ask the questions that were discussed in this article. Find out if the other franchisees in the company are happy with the way things have turned out for them. Once you’re confident that you’ve selected a franchise that will be a good match to your own business style and lifestyle, all you have to do is turn the key.

Way back in the last century (1991, actually) a survey was conducted by my research firm, MarketWave, Inc., of over 6,000 people who were not, nor had ever been, business owners. The question was a simple one: If all obstacles were removed, would you like to own your own business? In other words, if what ever was stopping you from starting a business didn’t exist, would you at least attempt it? Basically, would you prefer to be an entrepreneur, or an employee? Eighty five percent said Yes, they’d prefer to work for themselves. Which means 15% misunderstood the question on the survey. After all, if what ever concerned you enough to not attempt a business venture didn’t exist, then you’d have no fear of doing so. I mean, who wouldn’t want to be in control of their own life? To have the freedom to make their own decisions, work their own hours, and write their own pay check?

Even using the conservative 85% figure, that would mean about 200 million Americans want to start their own business, but have never even attempted it! There must be some pretty compelling reasons, we thought, so we set out to find out what they were. To no one’s surprise, it was never about preferring to work for someone else’s business, but rather the incapacitating fear of starting their own.
And it was the same four fears, every single time.

It takes too much money. They didn’t have tens-of-thousands, or hundreds-of-thousands of dollars to invest in a business (and they didn’t know anyone else who did).

It takes too much time. They didn’t want to work 80 hours a weeks for the first year or two to get their business going.
There’s too much risk. Over 56% of all businesses fail in the first two years, and they’d have to quit their job, so there was no safety net.

They didn’t know how. They’d never taken any business courses. They had no business experience. They don’t know anything about taxes, accounting, marketing, and they myriad other skills a good entrepreneur must possess.

Not all responded with all four objections, although most responded with more than one. Surprisingly, “I don’t know how” was the most common response. A lot of folks said they wished they had taken the plunge earlier in their lives, but they just weren’t the Mavericks they once were. They had a mortgage to pay and a family to feed. They felt is was – too late.

Now comes the fun part.

Would you ever consider going into business for yourself if; the total start up costs were under $500, the total time investment could be as little as 5-15 hours a week, you could continue to work in your present job until the income from your business was sufficient to earn you at least an equal income, so there is little risk, and best of all, there were numerous consultants available to you who are experts at running this business, who would train and advise you personally, for an unlimited number of hours, for the entire life of your business, absolutely free! Not only that, but there is another company that will take care of all your research and development, labeling, inventory, shipping, payroll, payroll and sales taxes, most legal questions, and so on. And, this company will do this for you every month, for the life of your business, for around, oh, $25.00 a year?

Right now, your probably remembering the old adage “If it sounds too good to be true…” Fine. But, hypothetically, would you consider it if all this were true? “Well, sure…” you’re probably thunking, “…but there’s got to be a catch.”

Not only is there no catch, I didn’t even hype the pitch by one iota. These are exactly the conditions in which thousands of successful network marketing ventures have begun.

Sure, some overly zealous networkers may tell you how rich you’re going to get, how easy it is, and how fast it will happen. Please note, I didn’t say that! Network marketing is a serious business, no less than any other you might consider earning your living at for the rest of your life. The reality is, network marketing is hard work, it takes time, and you’ll probably lose some money in the beginning. The difference is, most of the hardest work is done by someone else, your work is done when you choose to do it, it typically takes a few months to turn a profit (some accomplish this in the first month) rather than a few years, and what amount you might lose at first has one, two, maybe even three fewer digits compared to the start up loses of most conventional businesses. Yet, you can still reap the tax benefits of operating your own business, and you have just as much, if not more income potential as most conventional businesses!

Imagine becoming financially independent in one to three years without having to spend thousands of dollars each month, without having to work long hours seven days a week, without even having to quit your job during the development stage, and without having to get a business degree, or hire someone who has one?

If you are considering starting your own business, and you’ve got access to, let’s say, $50,000 in start up funds (a very modest assumption), imagine how profitable you could be, and how quickly, if you didn’t have to hire employees, you didn’t have to lease an office and/or store front and/or warehouse, you didn’t have to pay sales or payroll taxes, you didn’t have to spend one penny on R&D, graphics design, or development of promotional material, and you didn’t have to hire an accountant, lawyer, or business consultant. And, imagine how much more money might go into your pocket if you didn’t need business partners to help you finance and run the business. Think about it, and try not to become giddy.

Now for the really fun part.

Imagine buying a McDonald’s franchise for the modest sum of one million dollars. The business fails. You call up McDonald’s corporate and ask for a “Return Authorization Number” so you can get your franchise fee back along with a reimbursement check for your unsold supplies and stock. While imagining this scene, also imagine the sound of sirens wailing in the background. That would either be the paramedics coming to assist the poor corporate officer who you’ve just induced into a fit of hysterics, or an ambulance coming to take you to a really nice, soft room.

In network marketing, not only is this not an absurd scenario, it’s the law! One of the aspects of a legitimate, legal network marketing company is the ability of a failed distributor to get a full refund (usually less a 10% restocking and processing fee) on all product and marketing material that is in resalable condition. So, if pursued conservatively and intelligently, there is a monumental reduction in risk relative to conventional business start ups, yet with a comparable or even greater profit opportunity.

Those of you who are already actively involved in network marketing, be aware that the vast majority of your “outer circle” prospects (those who’ve never been involved in network marketing) do have at least the desire to own their own business, as opposed to working for someone else. You don’t have to talk them into the benefits of something they’re already dreaming about having. But, they also have some very powerful, legitimate fears about starting their own business. You’ve first got to open their mind to the idea that there is still a realistic way to achieve that dream, and then define, or perhaps defend, the concept of network marketing (gratuitous plug: my “Case Closed” cassette tape is designed to accomplish both of these steps for you). Only then should you introduce the benefits of your particular network marketing program. Think of it like this: before you can pour fresh, hot coffee into a thermos, you must first open it, then pour the old, stale coffee out, right? Think of your business-phobic prospect as a sealed thermos full of cold coffee.

Now, if you are considering starting your own business, or you want to but have always been apprehensive, open your own mind to network marketing. Think it’s too good to be true? I challenge you – find the catch! If you’ve never pursued a network marketing venture it must be for one of two reasons: you just didn’t know about it, or you have a prejudice against it. And that’s exactly what it is, a prejudice. You have prejudged this business based on what someone else has told you about it (usually someone who has failed at it, or who has also never been involved themselves). In other words, you’ve chosen to adopt someone else’s opinion of this business. Don’t let other people do your thinking for you. Make your own decision based on your own evaluation.

Check this business out. Really do your due-diligence. And when you are done, I would defy anyone, even the most devout skeptic, to not experience a significant paradigm shift.

I dare you to look and not be intrigued!

Many entrepreneurs exploring the expanding world of franchising may not have significant resources to spend on popular franchises, which can carry a price tag of several hundred thousand dollars. But there is good news for these future franchisees! Increasingly, low-cost franchise opportunities are becoming available, and these opportunities are making the dream of business ownership more accessible than ever before.

The cost of a franchise, including initial setup investment and continual expenses, varies dramatically by industry. It can range anywhere from under $50,000 for franchises including some home-based options such as personal care and business services to $200,000 -$300,000 for some auto repair franchises, up to $1,000,000 for fast food restaurants, up to $3.5 million for full service restaurants, and as high as $4 to $6 million for lodging franchises.

Despite the potential for success of many of these popular business franchises, oftentimes those seeking franchise opportunities simply do not have the money to invest. Yet, few realize that numerous franchises opportunities exist that are well within the reach of even the most modest budget. And with the explosive growth of the franchise industry, those looking to purchase a franchise are not limited by their budget to only a few business interests.

Entrepreneur.com recently released its 2007 list of the top 100 low-cost franchise opportunities. In order to make the list, the franchise had to offer entrepreneurs an entry option that would cost less than $50,000. While some franchises only offer “conversion options,” meaning that the potential franchisee needs already to own a business and then that business could be converted into a franchise, the http://Entrepreneur.com list excluded these from its top 100 list.

Perhaps most surprising about the top 100 is the range of business interests represented. In fact, under-$50,000 franchises businesses are available in each of the following industries:

* Automotive

* Business Services

* Children’s Products & Services

* Financial Services

* Food/Quick Service

* Food/Retail Food Sales

* Food/Full-Service Restaurant

* Health Care

* Home-Improvement Products and Services

* Maintenance

* Person-Care Businesses

* Recreation

* Retail

* Service Businesses

* Tech Businesses

* Training

What are some low-cost franchise opportunities that are out there? Here is just a short listing of some of the many options available, along with a brief description of the product or service provided and the startup cost range.

Made in the Shade Blinds

With a total investment capital requirement of just $9,500 – $14,500, Made in the Shade Blinds is among the most affordable franchises you will find! As part of a $5.3 billion annual industry, Made in the Shade offers a home-based franchise opportunity to interested entrepreneurs. The concept is simply a window covering business, and Made in the Shade provides training, startup inventory, and a training manual to its franchisees.

360 Solutions

Do you love the world of professional business growth and management but want the support that comes with being a franchise owner? 360 Solutions may be the option for you. A unique franchise opportunity, 360 Solutions trains its franchisees to provide business consultation services to small- and medium-size businesses. By working with businesses in the areas of human resources development, customer relations management, and cash flow management, franchisees help small-and medium-size businesses achieve their full growth and profit potential. For a total investment capital of $10,000 to $30,000 360 Solutions offers training that includes “360 University,” marketing action plans, and a coaching and business growth specialists network.

SeaMaster Cruises

Do you love the cruising lifestyle? If so, what could be better than owning and operating your own cruising franchise business? SeaMaster Cruises combines the best of luxury lifestyle with a lucrative business opportunity. Affiliated with the Carlson Travel Network Associates, Inc., a member of the Carlson Companies, SeaMaster Cruises offers a home-based business opportunity in an industry that has experienced an average annual growth rate of 8.4% since 1980. With the incredible income-potential available in this industry, it’s hard to believe the total capital investment for a SeaMaster Cruises franchise is only $9,500. If cruising is your passion, SeaMaster Cruises may be just the way to turn your passion into your vocation.

CD One Price Cleaners

If you want a low-cost franchise that offers a service constantly in demand, then what could be better than a laundry and dry-cleaning franchise? And if you’re looking for a franchise opportunity that you can start for NO COST, then what could be better than CD One Price Cleaners?

This Chicago-area franchise offers entrepreneurs the opportunity to start their own CD One Price Cleaners business at no cost! That’s right. The company provides all of the funding for your startup business by handling site location, store construction, and equipment and inventory purchasing – in essence, investing over $500,000 into your business. Then, CD One Price Cleaners puts you as the franchisee on a “manage-to-own” path. Currently located only in the greater Chicago area, CD One Price Cleaners currently has plans to open additional stores in 2007 and 2008. So if you’re looking for the ultimate in a low no-cost franchise, take a closer look at CD One-Price Cleaners.

As you can see, low-cost franchise opportunities abound in many industries. From home improvement and business services to luxury cruises, the options for purchasing a low-cost business franchise are varied, indeed. With determination and a bit of research, there is no doubt that you can find the low-cost franchise opportunity that is right for you!

“To Buy a Franchise, or Not To Buy a Franchise, That IS the Question!” Is it nobler to create ones own business or seek help through the purchase, and continued payment to a franchise. It is easy for me, having over twenty years in the restaurant field, to rely on my own knowledge and experience as opposed to paying someone else for theirs. But what does the new entrepreneur rely on. Research, tap the knowledge of friends, other business owners, and professionals you know and trust. Buying a franchise can be a positive solution, if you go into it with your eyes open and have done your research on those that you are interested in.

If you have decided to make that move from employee to employer, buying a franchise is definitely an option. Maybe you have been told for years that you have such a talent for car repair or pastry creations that you should open your own business. Should you try on your own or look towards a franchise for help. Some questions you need to ask yourself, whether you are going it alone or decide to take the franchise option are:

1.Do I have the leadership ability to get staff to do things I need them to do to help make the business run smoothly and profitable.

2.Do I have the patience and skills to train my staff for all of the duties that will need to be performed.

3.Am I prepared to act on my feet and change directions at a moments notice to handle the multitude of problems that may occur,IE…backed up plumbing in the restroom, disgruntled employee, unhappy customer, equipment breakdown,vendor shortages!

4.Am I prepared to spend long hours making it all work until I can finally enjoy the fruits of my efforts.

5.Do I realistically have the financial backing to keep the business going until I see a profit.

If you are having second thoughts now that I have opened your eyes to some of the “joys” of owning your own business I have saved the most important question for last…Do I really love doing what I am about to ask people to pay me to do, and would enough people be willing to pay me to do it to make a profit. The most successful entrepreneurs went into business doing something they had a passion for. Don’t waste your time trying to jump on someone else’s profitable bandwagon unless you want to be a musician yourself.

OK, you have decided that the Mars Buggy Whip Franchise is the type of business you have a passion for. You know you can do a better job than anyone else in the sales and

Thousands of businesses are started everyday around the world. Some are successful, earning an income for their owners. And some are VERY successful, catapulting their owners to a life of affluence and leisure. But the simple fact is that most new businesses fail.

What is the key ingredient of ALL really successful businesses? Why does one local hamburger joint remain just that – a LOCAL hamburger joint with one store, when another hamburger store turns into McDonald’s? Why does one local carpenter spend his life replacing shingles and siding, when the carpenter next door turns his business into a huge construction company, employing hundreds of construction workers and building 600 homes every year?

What do all SUCCESSFUL businesses have in common? I can answer that in one word: SYSTEMS!

The truth is, most local hamburger joints make a hamburger that tastes much better than McDonald’s. But when Ray Croc designed his McDonald’s empire, he developed a SYSTEM of building and marketing hamburgers. The end result? If you go into a local burger joint, you might get a better burger. Then again, you might not. But if you go into any McDonald’s anywhere in the world, you will know exactly what to expect. Every McDonald’s burger – worldwide – tastes the same. Because of the system. Ray Croc benefits from the system. Every local McDonald’s franchise owner benefits from the system. And the customers benefit from the system.

It’s the SYSTEM that makes the difference!

So, the hamburger entrepreneur has two options: he can open his own little local hamburger joint, or he can purchase a franchise – a SYSTEM – from McDonald’s. Which do you think has a better chance of success? How many times have you seen a McDonald’s restaurant go out of business?

Now, let’s talk about online home businesses. There are literally thousands of businesses opportunities available online for you to get involved in. But here’s the thing. Most of them do not have a system for you to plug into. Sure, they have a website, they have a few prewritten sales ads for you, and maybe a few banner ads. But they don’t have a complete, thorough, well designed and AUTOMATED system for you to tap into (like McDonald’s does). And they have very little, if any, training on how to use the few tools that they did give you. You are left to take the few tools they give you and then fill in the rest to build your own system of marketing and follow up. They give you SOME of the building blocks, but you must supply the rest and build your own system. It is crucial that you do so because the 96% of businesses that fail, do so for lack of a system. But do you even know how to build an effective system?

Here are a few things that a system for an e-business should include:

* An awesome product – one that is PROVEN to sell, not just one that you think might sell.

* Complete training for all business owners and affiliates.

* Thoroughly TESTED marketing campaigns using MANY different venues, both online and off line.

* A way to track every single ad to determine its effectiveness, eliminating the ones that don’t work.

* A way to test the conversion rate of the website.

* A way to collect the email addresses of every visitor to the website.

* A way to follow up with every visitor using ongoing automated email campaigns. (This is where MOST of the sales come from.)

* A way to make additional back-end sales to current or previous customers.

* A way to collect the money and fulfill the order.

* A way to service the product after it is sold.

And every one of these things should be either automated or outsourced. That way, you can spend your time doing other things, instead of talking to customers or shipping products.

So in your search for the perfect home business to get involve with, looking for a company that supplies a good product should not be your only objective. You should also look for a company that has a SYSTEM that is COMPLETE and PROVEN – a franchise, if you will – that you can just plug into. You should look for a SYSTEM that is completely AUTOMATED and/or OUTSOURCED – a system that does the work FOR YOU. The more complete the system, the less work you will have to do to make it profitable. The more complete the system, the less chance there is that you will inadvertently leave out one of the essential ingredients that every successful business must have.

If you find a system like this, it will increase your chances of success tenfold! Instead of spending your time beating your head against the wall, trying to build an e-business that is not quite making a profit, finding the proper SYSTEM will allow you to live the life of leisure that I KNOW you have always dreamt about!

If you’re thinking of buying a franchise, but don’t know where to start, it’s probably a good thing you chose to read this. Starting a franchise is a big decision for any entrepreneur and a lot of thought and planning must go into it.

You need to consider several factors before starting a franchise business – this process might make the difference between success and failure.

Let’s see what we’re talking about.

Set your goals: This is what it’s all about. Make a list of the reasons why you want to enter this business. What do you expect to get in terms of return on investment or annual income? Most important, do you have the commitment to go the distance?

Identify your investment capability: Estimate how much capital is required and how much you can afford to invest for starting a franchise of your choice. Hence you need to know the initial franchise fee, royalty payment terms and other expenses beforehand. You also need to decide if you want to go it alone or rope in some partners.

Know your abilities: As with any business, the success of a franchise will depend on whether you have the requisite skills. Take a long, hard look at your previous achievements and experience and focus on your areas of strength. For instance, you may be good at managing people or a sales whiz or great with computers! To become a franchisee of Subway® chain of restaurants, you need to pass a test in math and English. Choose a franchise opportunity that can leverage your strong points.

Do your homework: Look at the franchisor’s track record before taking up that offer of a franchise. Is the brand doing well? How are franchisees treated? What support services and training resources do they provide? An absolute must do – talk to other franchisees before you make that call.

Understand scope of business: Find out if there are pre-conditions regarding outlet size, operations methodology, restrictions on territory or any other. Know what you can and cannot expect.

Read the fine print: Once you have zeroed in on the franchise you want to buy, ask to see the inevitable Franchise Agreement. The agreement will list out the rights and obligations of both parties, and will govern the terms of your relationship. Be sure to take a professional legal opinion.

Also ask for a copy of the franchisor’s disclosure document, called Franchise Offering Circular. This will help you assess the franchisor’s financial stability and general business acumen and predict if the company is financially capable of delivering its promises. Under the Federal Trade Commission’s Franchise Rule, you must receive this document at least 10 business days before you sign up.

Ask yourself: Finally, ask yourself the following questions before starting a franchise:

§ Do I need any start up training?

§ Which location is best suited for starting a franchise business?

§ What equipment is needed?

§ How many people do I need to begin operations?

§ Have I considered all the risks?

Remember, due diligence is essential, and some professional guidance might come in handy.

One of the greatest decisions of any entrepreneur is in the choice of franchise that you buy in to. Therefore, there is a lot of planning and researching that needs to go into the process before deciding on a final franchise.

You need to have goals to work towards. For example, think about why you want to start a business and what you expect to get out of it. You must also think about if you will have the commitment to the business throughout as it can be a long and hard process at times.

Buying info a franchise may cost more or less money than you originally expect so make sure you know what financial requirements are expected of you and if you can afford them. This includes franchise fees, royalty payment terms and other expenses that you may have to pay along the way.

In order for your franchise to be a successful one you must ensure that you have the right qualities and skills. To do this you will need to look at your previous achievements and experiences and assess you areas of strength from these. There are certain maths and English skills that you need to have to become a franchisee of the Subway® restaurant chain. These will be tested before you can become a franchisee. In is advised that you choose a franchise to buy into that can leverage your strong points. Look at the background of the franchisor as you do not want to take up their offer if they have a history of being unreliable and unsuccessful. You will also want to work for a franchisor who treats their franchisees well and gives them support and training throughout the whole business process. You should definitely talk to other franchisees in order to get an idea of how that particular franchisor works before applying to the franchise opportunity.

There may be restrictions within the business that you need to be aware of in terms of outlet size and restrictions on territory. It is advised that you familiarise yourself with these when making your decision. Agreements that you are required to sign will list out rights and obligations of both you and your franchisor and these should be read very carefully, if possible with legal opinion.

Franchise Offering Circular is the franchisor’s disclosure document and you should make sure that you ask to have a look at this before you sign up as a franchisee. Reading this will help you to evaluate the financial stability of the franchisor and therefore see if they are financially capable of supporting you as a franchisee. It is law that you are given this document to read at least ten days before you sign up to the franchise.

So, before deciding to start up your own franchise, ask yourself these questions:

• Is training required before starting?

• Where is the best place to start up a franchise business?

• What equipment will be needed in order to start up th franchise?

• How many people will be required to start the operations of the franchise?

You will also need to consider all the risks that you may be open to throughout the business process as this will help you to minimize these risks and make your franchise business a success. You may like to get some professional guidance when choosing a franchise.

If you’re interested in having a franchise, you probably want to pick from the best ones out there. No one wants to pay a lot of money to start up a franchise, only to have it fail. Naturally you probably have a preference for what type of business you like the best. You have to ask yourself what’s more important – the type of business that you would like to patronize, or the type of business that you can make the most money at. Ideally you should try for both, but that’s not always possible. In order to make sure you have the highest chance of success, pick from these top franchises and you won’t have to worry as much about whether you can afford to do it and whether you can make it work and make a living off of it:

-7-Eleven

-Subway

-Dunkin’ Donuts

-Pizza Hut

-McDonalds

When you choose one of the franchise opportunities listed above, you can feel safe knowing that they’re the top five ranked franchises based on the ‘Franchise 500,’ which has been around since 1980 and is seen on the Entrepreneur.com Website. These five are the top options based on several areas of financial and business importance, including how much money can be made off of them and how high the rate of failure is for a franchise from that particular company. Also looked at are areas like the financial strength that the company has overall, the stability, the growth rate, how long the company has been in business and how much it costs for start-up of a franchise. The access to financing for starting up a franchise is also very important, because most people who want to do this can’t afford to pay for it out of pocket.

Q: I really want to start my own business, but I have no idea what business would be best suited for me. I’m also eager to get started, but I don’t want to pick the wrong business just because I’m impatient. How should I go about deciding what business would be best for me?

– Samuel J.

A: Before I answer your question, Samuel, I want you to reach around and pat yourself on the back for not letting your eagerness push you into making a wrong decision. All too often we entrepreneurs tend to let our impatience drive us to make decisions that we later regret. In business such haste can be very costly, indeed.

I always compare starting a business to jumping into a pool of freezing water. There are typically two types of entrepreneurs who take the plunge.

The first are the “Toe Testers.” These are those cautious folks who just stick their big toe in the pool to gauge the temperature of the water. It is for these careful entrepreneurs that the phrase “testing the waters” was coined. Toe Testers enter the business pool slowly, a little bit at a time. The lesson to be learned from Toe Testers is to start slowly and don’t feel like you have to wade in too fast. Ease into the business pool gradually to make sure it’s right for you. Remember, many entrepreneurs realize that the business world is not right for them only after they are in it up to their necks. And that’s when the term “sink or swim” takes on a whole new meaning.

The next type of entrepreneur is the “High Diver.” These are those fearless souls who climb the ladder and dive into the business pool head first without worrying about the depth of the water or the dangers that lurk beneath the surface. It is for these entrepreneurs that the phrase “damn the torpedoes, full speed ahead” was coined. Quite often these entrepreneurial daredevils find themselves drowning in unknown waters or end up with their heads buried in the bottom of the pool.

Both types of entrepreneurs may find success, depending on how well equipped they are to handle the water they are diving into. Here are a few ideas to help better prepare you for the plunge.

** Let your experience be your guide. Start with what you know. If you have spent twenty years working as an accountant or you love to build wooden toy trains as a hobby, consider how you can take that experience and turn it into a successful business. You might also find a great business idea right under your nose. Look around your workplace. Do you see needs that are going unmet or can you think of a better way of doing something? If so, you might have the seed for a profitable business.

** Do what you love and enjoy what you do. I can’t emphasize this enough. Many people start a business for the wrong reason: to get rich. While it is true that many millionaires in this country made their fortunes from their own business ventures, that should not be your sole motivation for starting a business. If you don’t enjoy what you do, you will not be successful, at least not from a mental point of view. Sure, the monetary rewards can be tremendous, but the mental anguish of working in a business you don’t enjoy is a high price to pay. I talk to entrepreneurs all the time who are running successful businesses, but are so unhappy as a result that they literally make themselves sick. If you don’t enjoy what you do the business will become a chore, not a joy.

** Don’t reinvent the wheel, just make it better. Many first time entrepreneurs assume that they have to come up with a new business idea to be successful. That simply is not true. Most successful businesses are born not of innovation, but of necessity. Instead of trying to come up with an idea that changes the world, take a look at the world around you and see where there might be a void that needs filling or a business concept that needs improvement.

Many successful businesses have been built by taking a traditional business and making it better. Domino’s Pizza was certainly not the first to offer home delivery of pizza, but they were the first to guarantee it would be delivered piping hot to your door in 30 minutes or less. Amazon.com was not the first company to sell books, but they were one of the first that would let you buy books from the comfort of your own home while sitting in your underwear.

** Focus on a niche. Many businesses have gone broke trying to be all things to all people. The ability to offer a gazillion products under one roof is all well and good for Wal-Mart, but not for most new small businesses. Try to identify a niche that you would enjoy working in and think about starting a business therein. If you love to work outdoors, consider starting a landscaping business. If you enjoy working with numbers, think about becoming an accountant or CPA. When’s the last time you had your gardener do your taxes? You get the idea. Focus on a niche and become an expert in your field.

** A franchise might be an option. Many new entrepreneurs consider buying a franchise operation instead of starting a business from scratch. Franchises are a good way to jumpstart the process because they have already done much of the hard work for you. They have proven the business model, established guidelines for running the business, spent millions of dollars on establishing the brand, etc. Buying a franchise is typically a very expensive and involved process that is beyond the scope of this article. The best thumbnail of advice I can give you is to thoroughly investigate the franchisor and the opportunity, use your own attorney to do the deal, and read the fine print in the franchise agreement.

** It’s hard to swim in a crowded pool. If the business pool is already filled with other companies doing the same thing you want do, chances are you will fail in the face of established competition. To succeed in such a crowded pool you will have to do something to stand out from the crowd (and I don’t mean greeting customers while wearing a bright red Speedo). If you can’t quickly and easily differentiate yourself from a large group of competitors, you’re better off choosing another business.

** Above all, take your time. Whatever business you choose to start, I encourage you to take the time required to make an informed, intelligent decision. Think about starting part time while you still have your current job (and income) to fall back on. Talk to friends and associates who use the product or service you will provide to see if they would consider become paying customers.

Remember, in business you can end up swimming in success or sinking in failure. The key to your success might just lie in the sensitivity of your big toe.

Here’s to your success.

Tim Knox