Life after FI? Anyone buy into a franchise?

[Aiming_4_55]

Ok, the last few weeks were a bit rough at MegaC*rp. Issues after issues, and 60+ hour work weeks. I've informed my boss, this is not what I signed up for.... I'm all for "putting out fires" but I'm not in it for a steady diet. I proposed bringing in 2 contractors if we can't get headcount. Meanwhile I don't plan to work more than 45 hours a week and he understood.... maybe I'll get canned.

So, yesterday I sat through a webinar on a franchise. $200k investment with estimated $150k annual net income projected with steady increases over the years.

I'm very close to FI on my projected expense budget. It's probably an over reaction, but I'm wondering if anyone FIRE to a franchise system or is it just asking for a steady diet of 80 hour work weeks? If you bought into a franchise, was it successful?

Kind of a rant, but I've been thinking of it as it would be nice to leave a business behind to my kids, probably a silly thought.

 

[misanman]

I worked with a guy that owned an Arbys.He still kept his job and his wife handled day to day at the restaurant. He told me he thought he'd need to have three restaurants in order to completely replace his income from his job. I can't see why it would take three but that's what he said. Maybe there are other franchises with a bigger payoff. Last I knew he was up to two.

 

[Nords]

Ok, the last few weeks were a bit rough at MegaC*rp. Issues after issues, and 60+ hour work weeks. I've informed my boss, this is not what I signed up for.... I'm all for "putting out fires" but I'm not in it for a steady diet. I proposed bringing in 2 contractors if we can't get headcount. Meanwhile I don't plan to work more than 45 hours a week and he understood.... maybe I'll get canned.
So, yesterday I sat through a webinar on a franchise. $200k investment with estimated $150k annual net income projected with steady increases over the years.
I'm very close to FI on my projected expense budget. It's probably an over reaction, but I'm wondering if anyone FIRE to a franchise system or is it just asking for a steady diet of 80 hour work weeks? If you bought into a franchise, was it successful?

Your life is miserable because your boss is struggling to solve headcount problems, but one of your possible solutions would be to buy a business where you're in charge of solving headcount problems?

I think "FIRE to a franchise system" is a [-]conflict[/-] contradiction of terms. But hey, you'd be the boss, so at least you could close the shop whenever the surf is up.

 

[haha]

So, yesterday I sat through a webinar on a franchise. $200k investment with estimated $150k annual net income projected with steady increases over the years.

You haven't said what this franchise is, but likely those are very optimistic projections. And there is a much larger than non-zero chance that you will go from almost ready to FIRE to broke. I think it is a really bad idea for someone whose true goal is to quite working soon, to go out and spend $200,000 and likely a good slug of debt on a franchise.

Ha

 

[MichaelB]

My brother chose to open a franchise based business after (involuntarily) leaving his corporate job. There are businesses with legitimate financial profiles similar to the one described by A455. Not many, and he will need to work for quite a few years, so FI is possible but ER is not.

 

[Ronstar]

Running a business takes a lot more commitment than most people realize. I'm sure the webinar made the franchise look attractive, but it probably didn't accurately explain the amount of work needed to keep the business running. It will most likely be more than a full time job for a prospective retiree. And that's the rub - you probably won't be able to retire while owning the franchise - unless you hire someone to run it. And you probably won't get a decent ROI if you hire the management personnel to completely run it.

And how do you get rid of it once you decide to get out? What if your kids have no desire to run the business?

 

[LOL!]

My BIL bought a franchise in order to give his kids jobs. It did work out well for the kids, but this guy will never be able to retire. It is all work and no play. Weekends, nites, holidays, never finding good employees, work, work, work. You get the idea.

 

[cardude]

Bad idea IMO if you want to consider yourself retired.

I started a small business after getting restless with ER after two years. Thought it would be a fun, part time deal that would provide beer money and give me a place to go during the day. It has now grown into a full time gig, complete with the usual employee headaches. It's successful and making more money than I thought it would, but it's taking on a life of it's on now and getting bigger than I wanted.

 

[W2R]

You haven't said what this franchise is, but likely those are very optimistic projections. And there is a much larger than non-zero chance that you will go from almost ready to FIRE to broke. I think it is a really bad idea for someone whose true goal is to quite working soon, to go out and spend $200,000 and likely a good slug of debt on a franchise.

+1 Buying a franchise does not sound like a very good idea at all for someone who is hoping to retire anytime soon. I'd suggest trying to patch things up at your regular job, and putting your extra energy into your LBYM efforts instead of into a franchise.

Sorry to hear that things are so bad at Megacorp, Aiming_4_55. It seems like long hours and additional stressful duties are expected more and more in recent years, even in jobs that once did not require them.

 

[jerome len]

Sounds like you are running from a job rather than running to a fun, productive, profitable life. Over 80% of all small business go bankrupt every ten years. Look at all the empty buildings that housed retail franchises.

If you think you would love the business, work up to 80 hours and smile every day since you made the change, confirm your decision by making surprise visits to other comparable franchises, talking to the employees just asking, "how are you and the business doing?" Look for franchises where current owners are buying more locations.

Don't forget you pay for all your benefits.....no more big corp 401k, health care partially paid, paid vacations, etc. And, when you want to retire, you have to sell it to get your money back.......sometimes impossible.

Do I sound negative? I've been there and done it. And, I'm wealthy, happy but have a ton of work, employee challenges, constant investments and finding it hard to pass the business along to others.

Would I do it again? Not, if I was unhappy working 50 to 60 hours a week. A business is your life, frankly I don't think you would like it. But......if you think different, do it and I hope you love it. good Luck!

 

[rescueme]

My parents went that route back in the early 60's (fast food franchise).

Based upon the sacrifices made and the impact to the family, I would never do it.

However, if you're willing to dedicate your time 7x24 (more than I assume you're currently doing) to get a "paycheck" and make it a success, then it just might be for you.

It took my parents a little over a decade to realize they were not cut out to deal with the misery and sold out (shortly before their divorce).

It also taught me that I would never want to own a business, with my personality (I'm not a Type A). I would rather others take the risk to provide me with a paycheck.

Just my story...

 

[Chuckanut]

Most people I know who own their own business (franchise or not) would love to work only a 60 hour week. The exception are those who are a self-employed, business of one. Once you have employees, the work effort goes up.

 

[ERD50]

I worked with a guy that owned an Arbys. He still kept his job and his wife handled day to day at the restaurant. He told me he thought he'd need to have three restaurants in order to completely replace his income from his job. ....

Wouldn't he need three wives? -ERD50

 

[Texas Proud]

Bad idea IMO if you want to consider yourself retired.

I started a small business after getting restless with ER after two years. Thought it would be a fun, part time deal that would provide beer money and give me a place to go during the day. It has now grown into a full time gig, complete with the usual employee headaches. It's successful and making more money than I thought it would, but it's taking on a life of it's on now and getting bigger than I wanted.

It only gets bigger if you allow it to get bigger... if you want it smaller, you can make it smaller...

 

[Retire2013]

Don't do the franchise. My brother in law was forced to take early retirement with a very attractive severance package. He could not find work that pays anywhere near what he was making so he and his wife attended many seminars exploring various franchises. He tried 2 different franchises, both he and his wife had to work extremely hard, several years later, he's a million dollar POORER than before he started. He's been trying to sell his franchises, there are no takers. Just don't do it. My 2 cents.

 

[Rustward]

Aiming_4, there is a crystal clear tone to this thread. No additional comments needed.

 

[Nords]

It has now grown into a full time gig, complete with the usual employee headaches. It's successful and making more money than I thought it would, but it's taking on a life of it's on now and getting bigger than I wanted.

At times like this my spouse rests her sympathetic gaze upon me, looks deep into my eyes, and asks "So, Nords, what's your exit strategy, dammit?!?"

 

[Keim]

Why work so hard to become FI only to buy yourself a tough job with long hours and a high degree of risk?

 

[Aiming_4_55]

....Kind of a rant....

Yeah, yeah, you guys/gals are right. It was kind of a rant, sorry.

I just need to draw the line at 45 hours/week. I've check with a couple of temp agencies and can get a reasonable assignment for what I do for a good hourly rate ($60-75) if I had to move on.

The franchise was a take and bake pizza place. It's reasonable but luck of the draw and open 7 days a week. I grew up in a restaurant business, so I should know the demands on family and time.

I'm gonna ask for four 10 hour days for the summer, I pretty much already work long days now.

Thanks for the replies.

 

[Ronstar]

Wait a minute - you didn't say it was a pizza franchise. That may change a lot of our opinions.

 

[Aiming_4_55]

Wait a minute - you didn't say it was a pizza franchise. That may change a lot of our opinions.

LoL Ok, is it less work then? Wanna chip in to a partnership?

Actually, it's 11am - 8pm operation, so less hours than a standard fast food. Take & bake = less overhead, dinner part time employees = high school kids, but still 7 days a week.

I honestly just need a couple of years to get to my cureent plus budget, so I don't need the extra risk. I think'll just look for a duplex or triplex short sale to add to my rentals and a contract position if I walk out, but I'll be professional about it.

 

[Texas Proud]

LoL Ok, is it less work then? Wanna chip in to a partnership?

Actually, it's 11am - 8pm operation, so less hours than a standard fast food. Take & bake = less overhead, dinner part time employees = high school kids, but still 7 days a week.

I honestly just need a couple of years to get to my cureent plus budget, so I don't need the extra risk. I think'll just look for a duplex or triplex short sale to add to my rentals and a contract position if I walk out, but I'll be professional about it.

So let me get this straight.... you go out someplace to buy a pizza that is NOT cooked And you are supposed to go home and cook it yourself?

And how much would these pizzas cost? And how are they so much better than you can buy at the grocery store? Or buying a cooked pizza from one of the big chains or even local guys who make a great pie

I just do not get the business model of this franchise...

 

[flyfishnevada]

Wait a minute - you didn't say it was a pizza franchise. That may change a lot of our opinions.

Two words: Free Pizza

So let me get this straight.... you go out someplace to buy a pizza that is NOT cooked And you are supposed to go home and cook it yourself?

And how much would these pizzas cost? And how are they so much better than you can buy at the grocery store? Or buying a cooked pizza from one of the big chains or even local guys who make a great pie

I just do not get the business model of this franchise...

We do take and bake all the time. Way better than the budget chains like Pizza Hut or Little Caesars. A lot less money that the high end places and better than most supermarket pizza. Good stuff.

 

[haha]

It only gets bigger if you allow it to get bigger... if you want it smaller, you can make it smaller...

This isn't necessarily true, unless you are an accountant or some other professional. Businesses often must grow or die, largely because grow is what your competitors are trying to do.

Ha

 

[Ronstar]

LoL Ok, is it less work then? Wanna chip in to a partnership?

Actually, it's 11am - 8pm operation, so less hours than a standard fast food. Take & bake = less overhead, dinner part time employees = high school kids, but still 7 days a week.

I honestly just need a couple of years to get to my cureent plus budget, so I don't need the extra risk. I think'll just look for a duplex or triplex short sale to add to my rentals and a contract position if I walk out, but I'll be professional about it.

i like the take and bake idea. i love pizza and I'd consider a partnership, but I'm getting too old to work and don't want to get fatter from the constant diet of free pizza.