When your military service ends, making the transition back into civilian life isn't always easy. If you're unsure what you should do when you're done serving the country, have you ever considered running your own business?
Military veterans tend to have strong leadership skills and are fast-thinking problem-solvers, which makes entrepreneurship an attractive option for them. In the United States, about 25% of veterans are interested in starting small businesses.
Many franchisors recognize that service members often make successful franchise owners. Many of them design their franchise opportunities to attract veterans by offering various incentives.
This article will walk you through everything you need to know about veteran franchising and becoming a business owner, as well as some of the top franchises for veterans.
Things to Consider When Selecting a Franchise
If you're looking for the right business opportunity for you, consider franchising a business. After all, there are numerous advantages to the franchise business model.
As a franchisee, not only do you get to be your own boss but also much of the work in starting a business has already been done by the parent company. You just need to buy into the franchise brand and implement their ideas and plans in your area. You'll receive significant support from the parent company, as well, and you'll have a built-in customer base.
Franchises also tend to have a higher success rate than independent small businesses. A recent study found that 92% of franchises were still in business after two years and 85% were still going after five years. Meanwhile, 20% of all U.S. businesses close within two years. Because of the higher success rate for franchises, it's often easier to obtain funding for them than for an independent business.
As you begin to explore franchising opportunities, here are some factors to consider when selecting the best business for you.
Industry
There are nearly 800,000 franchise establishments in the United States across countless sectors, but how do you know which one is right for you?
First, consider your interests. Which industry could you see yourself working in? You might see yourself working in home services but not home care services. Narrowing down your industries of interest is an easy way to start making a list of potential franchises.
Franchise Fees
Franchisees will be required to pay a one-time franchise fee to operate under the parent company's brand. This fee can range depending on the industry and the company, from as low as $10,000 to as high as $100,000. On average, though, most franchise fees will range from $20,000 to $35,000.
Total Upfront Costs
The franchise fee is just one piece of your total initial investment in a franchise. Depending on the type of business you're running, you'll need to either purchase or rent a space to operate from. Then there are employee wages and staffing, insurance, legal fees, registration fees, equipment, inventory, business licenses, security, and marketing costs. On average, the initial upfront franchise investment is $250,000 excluding real estate.
Royalty Fees
In addition to your franchise fee, you'll also be expected to pay an ongoing monthly royalty fee. This could be either a percentage of profits or a fixed fee. On average, a royalty fee is 5% or 6% of your revenue.
Other Fees
Your parent company will often require you to pay other fees, as well, including marketing, technology, and educational fees.
Training Programs
Your franchise's parent company wants to provide you with the tools you need to succeed. Many offer training and mentorship programs to help you start up your business. If educational opportunities are important to you, pay attention to the training packages offered by franchises.
Company Track Record
As you review franchises, study their track records. Do they have a proven business model that's been successful in markets similar to yours?
Competition
Don't jump blindly into purchasing a franchise. Determine a brand's competition in the area where you plan to operate. By analyzing the local market and how your competitors are doing, you can get a decent idea of how a franchise might do.
Best Franchises for Veterans
Now that you know what to look for when considering franchises, here are some of the best franchises for veterans. Many offer incentives, such as a lower franchise fee or smaller royalty fees, through the International Franchise Association's VetFran program. These companies use these incentives through the IFA to draw veterans to their brand.
UPS Store
The UPS Store is the No. 1 postal and business services franchise in the world. It intentionally seeks military veterans by offering them $10,000 off the franchise fee for a new UPS Center. It also offers special programs for those looking to open in smaller towns.
FastSigns
This franchise offers special deals for veterans and first responders. Among these initiatives are a $24,875 franchise fee (it's usually $49,750), reduced royalty fees for the first 12 months in business, flexible location options, and SBA-approved funding.
Budget Blinds
The Budget Blinds franchise system offers a 15% discount to qualified veterans as a way of giving back to this community. The Budget Blinds parent company, Home Franchise Concepts, has awarded more than $1 million in discounts to veterans.
Sport Clips
As an incentive for veterans, the Sport Clips brand offers a 20% discount off its franchise fee.
Two Men and a Truck
The Two Men and a Truck brand helps build up veterans by offering various incentives, including a 10% discount on the franchise fee. The company allows you to take these savings and invest them directly back into your business. This takes some of the pressure off having to come up with the startup funding.
Mr. Handyman
To honor those who have served, Mr. Handyman offers a 15% franchise fee discount for veterans who have been honorably discharged.
Dream Vacations
This travel agency is another veteran-friendly franchise brand. This brand offers three levels. The first level, which is designed specifically for those new to the industry, has a $10,500 franchise fee. At this level, U.S. veterans and those with active-duty spouses get a 30% discount on this initial fee.
Pinch A Penny
As a supporter of the U.S. military, Pinch A Penny offers veterans a hefty franchise fee discount: 50%.
Baskin Robbins
This ice cream chain actively seeks veteran franchisees through various initiatives. These include the waiver of the 20-year franchise fee when opening their first shop, a savings of $25,000. Veterans also get reduced royalty rates for five years and do not have to pay royalties during their first two years in business.
Pillar to Post
This home inspection brand provides numerous benefits for veterans who are franchisees. Veterans get a 20% discount on the franchise fee (a discount worth $9,000), funding assistance through Veterans Administration programs, and the support and training needed to succeed.
Mosquito Joe
This pest control brand offers financial incentives for veterans. These incentives include a $6,000 discount off the initial franchise fee.
Oxi Fresh
As a VetFran partner, this carpet cleaning brand targets veteran franchise owners through financial incentives. Veterans can get a 10% discount on the purchase of an Oxi Fresh franchise.
Checkers and Rally's
To honor those who have served in the military, Checkers and Rally's fast-food brands, which are owned by the same company, waive the entire $30,000 franchise fee for veterans.
Rely on Skynova's Small Business Platform
As you settle into franchise ownership, Skynova is here to help your new business succeed. Our all-in-one accounting software makes it easy for you to track all of your financial activities and keep accurate records of all money coming into your business and going out.
Simply plug in the data from your income, expenses, sales tax, and payments to generate the documents needed for accurate bookkeeping. Our easy-to-use platform means less time spent on paperwork and more time running your business.
Notice to the Reader
The content within this article is meant to be used as general guidelines and may not apply to your specific situation. Always consult your local and state business laws before starting a company. Also, pay close attention to your parent company's franchise rules and regulations after signing a contract with them.