Buying a franchise is not a simple decision. If you already have a background in the industry you’re interested in, it can seem like it’s merely a matter of raising funds for the investment. After all, working as an employee for a senior care company is just about the same as owning an at-home senior care franchise, right?
Wrong.
No matter how familiar you are with an industry, owning a business is vastly different from being an employee. Here are just a few of the common challenges you might face as you transition from employee to owner.
Facing Uncertainty
One of the biggest challenges of becoming a business owner is the uncertainty that comes with it. When you're an employee, you have a steady income and a defined set of responsibilities. But as a business owner, there are no guarantees.
You're responsible for everything, from finding clients to managing cash flow and growing your business. This can be overwhelming, especially if you're used to having a clear set of tasks and goals set for you. And you may not know yet how successful your business idea will be.
To overcome this challenge, it's important to have a solid business plan in place. A business plan will help you define your goals and create a roadmap for how you're going to achieve them. It will also help you identify potential obstacles and come up with solutions before they become major issues. Having a plan in place can give you the confidence you need to take the leap and start your business.
Embracing a Bigger Work Load
Becoming an entrepreneur requires a lot of hard work. And many new owners find themselves working far beyond the 40-hour work week to get everything done.
Luckily, if you are becoming a part of a franchise family, your franchisor and fellow franchisees will help you apply the system successfully, answer questions, and support you in setting up your business. This can help you manage your workload more efficiently.
But being a business owner — as part of a franchise or not — is difficult and may require a lot of hands-on work during the first few months or even years. Meanwhile, employees have the luxury of going home at the end of each work day, relaxing with their family, and enjoying their hobbies. Generally, they get to leave work at work.
To help you overcome this challenge, set realistic expectations for the first few months and years of your business. Expect that you will have to put in extra hours or take calls on weekends.
It can also be extremely helpful to establish a routine. Set specific hours for work, and stick to them unless an emergent need arises. Prioritize tasks and set goals to track your progress. This can help you stay focused and productive during work hours.
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Developing Wide Range of Skills
Another challenge that many new business owners face is the need for a wide range of skills. As an employee, you may have had a specific set of skills that you were hired for. Your job was likely highly focused on utilizing that set of skills, and you may not have needed to develop skills in other areas.
But as a business owner, you need to wear many hats. You need to be able to handle everything from marketing to bookkeeping to customer service. Each and every day, you will likely be faced with something new, something outside your comfort zone.
To overcome this challenge, identify your strengths and weaknesses. Focus your business tasks on the areas where you excel and consider outsourcing tasks that are outside of your expertise. Hire team members who can take on responsibilities in areas where you are weak. This allows you to focus on the areas of your business where you can make the most impact.
Managing Finances
Another huge hurdle is the financial aspect of starting a business. Starting a business can be expensive, and it can take time to start generating a steady income. Many new business owners struggle to make ends meet while they're getting their business off the ground.
Most employees don't have to worry about budgeting for an entire business. They may be responsible for a portion of the budget, like marketing expenses. However, employees generally never see the entire budget. And some may not even know how to budget their own personal finances.
To overcome this challenge, create a realistic budget in place. Make a list of all the expenses associated with starting and running your business, and then prioritize them based on importance. If finances isn't an area where you feel comfortable, work with someone who can help you.
It's also important to have a plan for how you're going to generate revenue. Consider creating multiple streams of income and diversifying your revenue streams. This can help you weather any financial challenges that may arise.
Taking on HR Duties
As a business owner, you will have to make hard decisions on a regular basis. Some of the most difficult challenges for owners are HR related. You are responsible for choosing a team that will be able to help your business thrive, and, when one of those team members is not working out, you will be responsible for firing them. Managing your team, having difficult conversations with them, and firing underperforming team members can be one of the most difficult skills to learn.
As an employee, you may have been on the receiving end of those difficult conversations at times. But it is entirely different to be the one initiating and guiding the conversation. Luckily, there are many resources that can coach you through how to navigate difficult conversations as a leader.
Accepting Accountability
As an entrepreneur, there's no where to hide if you experience failure. Ultimately, your business is your business, and you will be responsible for its success or failure. As an employee, you can share or shift accountability to other team mates or your boss. If things go really wrong, you can leave the company without taking a loss.
Business owners put everything on the line and are accountable for the business at the end of the day. That means you can't take a passive role in your business. You will have to make decisions, say "no" every now and then, and actively pursue the success of the business.
Being a business owner can be extremely rewarding, but the transition from employee to owner is not always an easy one. Going into the process with your eyes open, ready to work is imperative when moving from being employed to being your own boss. Making sure you have a clear picture of the work involved before making the move is one of the first steps towards franchise success.
