Having helped tens of thousands of people explore self-sufficiency through business ownership over the past 36 years, The Entrepreneur’s Source coaching network as seen many trends come and go. Because our 150+ coaches across North America talk with hundreds of people every single day, we have a strong pulse on what fears and concerns adults have on a daily basis. And for those still gainfully employed, they are having conversations about what they can do to establish new businesses without having to leave their current career.
One of our most popular blog posts on FranchiseMatch.com was this “Realities of Semi-Absentee Business Ownership” from 2019. Google certainly found this article credible for the thousands of people they’ve directed to it since. It covers one type of business ownership very well, but in retrospect, we should probably give other type of business ownership equal time and attention.
In reality, there are many types of business ownership that are available. Below we’ve outlined the most common categories we discuss each day when coaching clients to achieve their Income, Lifestyle, Wealth, and Equity (ILWE) goals. Do you see a way for you to maintain your current title and position while adding a new career as “franchise business owner” to your resume?
Absentee Owner: While this category was once relegated to vending machines and movie rental kiosks, in 2020 there are many more options for businesses that can generate income automatically with very little on-going attention, maintenance or resources. Absentee business owners tend to their businesses during the nights and weekends away from their regular jobs and professional careers.
Semi-Absentee Owner: While we covered the Semi-Absentee Franchise ownership role with this in-depth article last year, this category is ideal for working professionals who have a solid career but are seeking additional income that is not dependent upon their current employer. Over the past decade, we’ve seen a surge by well-employed professionals seeking semi-absentee business ownership opportunities to provide an extra layer of financial security for themselves and their families.
Equity Partner: Most legal definitions of this term will include the concept that someone provides a financial investment in exchange for future profits the business may generate. Within this business ownership role, you have additional variations that can range from “silent” partners to “active” partners, all of which are commonly negotiated and established in legally binding partnership agreements.
Owner-Operator: As someone seeks to replace lost employment income from a job with a new business opportunity, the most common avenue is as an owner-operator. This franchisee is typically engaged during normal business hours, and is active in all aspects of the business each day. Frequently, this person acts in most of the capacities of the business, including unit manager.
Multi-Unit Franchise Owner: One of the fastest growing aspects of the franchise industry is multi-unit franchising, whereby a franchisee agrees to open three, five, ten or more units within a given territory, over a specific period of time agreed to by the franchisor. Because the franchisor has developed proven systems for operating the business, multi-unit franchisees can use technology, like smartphones, to oversee the operations of multiple business units from wherever they might be. Unlike “Owner-Operator”, this type of business ownership relies more heavily on hiring competent managers that are accountable to the franchisee while being monitored by smart technologies.
Multi-Brand Franchise Owner: Some of the most experienced and sophisticated franchisees develop an ability to manage multiple units, but also invest in multiple brands. A simple example is with your local car dealership where you’re likely to find Dodge, Lexus, and Kia autos from one local franchisee. In less obvious ways, it’s possible that the franchisee who is responsible for your local pizza franchise also operates the local taco restaurant franchise as well to capture a bigger and more consistent portion of the local food market. Further, it’s commonplace for a multi-brand operators to also be multi-unit franchisees as well.
Area Developer / Master Franchisee: These special legal arrangements empower a person or business group to take growth accountability for a given brand within a large territory; typically a state or states, a province, or sometimes an entire country. In exchange for taking on the costs and efforts of developing new franchisees in that territory, an Area Developer or Master Franchisee would typically receive some designated percentage of upfront franchise fees and/or on-going royalties paid by new franchisees, over a period of time. Area Developers also act as a front-line support for the franchisor since they have a vested interest in making certain new franchisees ramp-up quickly and become profitable to benefit all parties.
While these different business ownership categories do not represent a complete list of roles, they are certainly the most common we work with each day. To learn even more about these roles and possibilities, we suggest starting with the first step of FranchiseMatch.com to begin your Journey of Discovery. Obviously, not all franchise businesses will ideally match your requirements for ownership, but by working with an Entrepreneur’s Source (ESource) coach, they’ll help you identify the best possibilities ideally suited to your requirements.
We look forward to helping you take the next step in business ownership!