So you've decided you want to be your own boss. Maybe you've had enough of corporate bureaucracy, or maybe you want more control over every day decisions. Either way, starting your own journey of organisational management begins the moment you start thinking about buying your own business.
But do you know what business model suits you best? It may come down to the way you think about success and your appetite for risk. Which what sounds more like you?
Are you an independent business owner?
If you lean more towards self-realisation and see yourself as somewhat of a visionary, then you're probably desiring to command the ship as well. A business for sale will usually be somewhat set up and ready to operate: It will have a basic model in place, possibly even some staff and equipment for you to build upon, but this is your blank canvas. You can change anything and create whatever you want, having the total ability to re-imagine it for yourself.
You will have full strategic control, which gives you a lot of power. But this also leaves you with a lot of responsibility. You will have to manage all of the business processes and make important decisions around marketing, innovation, financial management and supply chain. With this in mind, you first need to digest the fact that the US Small Business Association reports that one-third of businesses with employees will fail within the first two years, while only half will last more than five. So this option is not for everybody. But even if you do not make it financially, you will still succeed in trying to turn your vision into a reality.
Are you a franchise operator?
Alternatively, if you prefer managing the day-to-day operations of a business rather than thinking about your five-year growth plan, then buying a franchise is probably right for you. Franchisees belong to a network of stores that report to headquarters, where the major strategic decisions are made. When you buy, headquarters will essentially equip you with a guidebook that details rules to follow, and you are contractually obliged to do so.
This offers many of the benefits of business ownership, but with far less risk. For instance, New Zealand franchise researcher Scott Shane found that independent business owners only have a 35 per cent success rate after four years, whereas franchisees were as high as 62 per cent. So your chances of earning money are much higher, but a lot of your business wins will be absorbed by the company. And while this is generally as low as three to 10 per cent, according to a Forbes article, there are additional fees that may not yet have been taken into account.
It really comes down to your appetite for risk and your ability to be committed to the opportunity. To find something that fits with you, check out the businesses for sale and franchise opportunities available across the country on BSale.