Young ones take the franchise route to success
With one-in-five young people in the UK out of work, more and more people are looking to self-employment for a secure and rewarding career. Tiffany Brooking explores the benefits that franchising has to offer budding entrepreneurs
The latest figures to be released by the Office for National Statistics (ONS) revealed that in the first quarter of 2011, the number of people aged between 16 and 24 who were out of work hit 963,000 – 12,000 more than in the previous quarter, pushing Britain’s youth unemployment rate to 20.05 per cent.
With such gloomy prospects for young workers, entering into the world of self-employment may be an attractive option for many ambitious individuals. Most people in their 20s don’t have the necessary experience to start a business from scratch so for these would-be entrepreneurs, buying a franchise can eliminate a lot of risk associated with starting a business.
When joining a franchise opportunity, franchise owners can enjoy the benefits of being self-employed – such as flexibility and control of business growth – while receiving initial training and dedicated ongoing support from an established franchisor.
While national statistics highlight the fall in youth employment, Managing Director of Autosheen, Paul Fennell has seen a positive rise in the recruitment of young owners within his franchise network.
“We have recognised a new trend at Autosheen of recruiting young people, as 50 per cent of our franchise owners recruited over the last four months have been under 30 years old. We believe this is due to a combination of factors, which include the support and business guidance, the extensive free training that Autosheen provides, the affordability of buying a franchise and the flexibly of expansion.”
Determined not to become another statistic, Steve Gladwin, 25, decided to buy an Autosheen franchise.“After being made redundant and dragging my feet for a few years, I decided it was time to sort myself out,” he says. “I knew I wanted to run my own business and incorporate my passion for cars, so Autosheen was the perfect solution as it has a good business model and excellent support.”
Though many young people may not have business experience on their side, in some cases, product and systems knowledge can be just as valuable. Buy, sell or exchange entertainment franchise CeX has many young employees who have gone on to become successful franchise owners.
Without a proven financial track record, some young people may find it hard to secure the funding needed to start their own business. However, most national banks, such as NatWest, which launched a £100 million franchise fund specifically to support people who want to start their own franchised business, approve 90 per cent of franchise loans – confirming the lower risk and proven model’s that franchised business have to offer.
Richard Holden, Head of Franchising at Lloyds TSB Commercial, confirms that banks are keen to assist any strong business proposition where the business owner is seeking financial backing to support their plans.
“Naturally those investing in a well established franchise brand have the benefit of a proven business model, initial training and ongoing support from the franchisor,” he explains. “This is something that isn’t available to those setting up their business independently from scratch. Investing in a tried and tested franchise opportunity reduces the risk of setting up in business, however it doesn’t eliminate risk altogether. Any business takes a great deal of commitment, energy and hard work from the business owner to develop successfully.”
Another less common avenue is to gain financial support from the franchisor directly. Riverford Organic, for example, recently offered six young people the chance to launch their own businesses in the North West of England by providing them with a business start-up and a development loan.
Kate Clemens, Franchise Recruitment Manager for Riverford, said: “Traditionally, franchise owners tend to be people who have both the capital and the business experience behind them to build their own successful business. However, we are keen to open up opportunities to younger people who may not have the resources to invest but who have the raw business talent and can bring a different and dynamic approach to the business development.”
If you’re an ambitious individual who has the drive and enthusiasm to build a business with the guidance of an established and experienced franchisor, a franchised business may be the perfect opportunity for you.