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Veterans Make Great Franchisees

Before getting into why franchising is a good choice for veterans, let’s talk about why franchising is a good choice in general. Franchising is system for delivering consistently high quality and uniform methods of preparation. It provides an already proven product a brand name and a complete methodology for bringing a product to market. That is what Ray Kroc did at McDonalds and Ray DeLuca did at Subway and why franchising is a successful business model.

The methodology enables franchise systems to offer shorter start-up time, a built in support network, pre-established guidelines for the “back office” procedures which are generally the most challenging part of starting a business for most people. In order for a franchise system to flourish all this information about the “system” is  tediously researched, tested, and documented in an Operating Manual.

The other important trait for success in franchising is the ability to be a team member as well as a leader.  To achieve your goals you have to lead your business, your employees, your community as well as be a team mate to the franchisees that precede you and the ones who follow you.

So, what abilities and character traits do veterans possess that make them excellent franchisees and why should franchisors proactively seek out veterans as franchisees and business partners?

According to Defense Dept. 2005 White Paper Who is Volunteering for Today’s Military “…each year, about 180,000 young Americans enlist for active duty in the Armed Forces. Over 90% have a high school diploma, compared to 70% of their civilian peers, 66% are drawn from the top half of America in math and verbal aptitudes ,a strong determinate of training success and job performance.”

The military is much like a franchise in that it requires commitment, provides a structure, a standard operating procedure (SOP) and is a community.  In the military every aspect of training; how to walk, talk, dress, the training in a military occupational specialty (MOS) includes operations instruction. Everything from how to cook a potato to how to fly an F-18 fighter jet is delivered in an “Operating Manual”. Veterans are trained throughout their career in the discipline of following “Standard Operating Procedures” (SOP) to execute assignments and to solve problems. SOP’s are a source of familiarity for veterans and alleviates the “I don’t know what I don’t know“ questions of operating a business which mitigates some of the risks of investing in franchising.

An operations manual does not guarantee the business will not have its “hiccups”. The veterans training and abilities to overcome, adapt, improvise and not to let setbacks deter their focus on the mission is one of the many traits of every veteran.

Other essential traits include leadership and teamwork. Teamwork begins day one in the military. Veterans learn very quickly the ramifications of their actions to the others on their team. There’s one day, when I was in boot camp, which I can assure you was many moons ago, that is still fresh in my memory. It was a muggy, late October day in Paris Island, SC and we were standing our first company inspection on the parade ground.  We must have been standing there for at least a couple of hours as we were the last platoon in the company to be inspected.  The sand fleas were out in force that day and all of a sudden just as the Company Commander was walking our way, I heard a loud slap. One of the guys had slapped and killed a sand flea that had landed on his neck. Everyone heard it, it seemed to echo across the parade grounds. The Company Commander and a Drill Instructor did a bee line for the guy who had murdered one of their sand fleas and the entire platoon spent the rest of the day digging a six by six grave with one Marine Corp issue 24” Tri-Fold Shovel. Lesson learned: If one team member messes up, all will suffer the pain and consequences.  As you can imagine this lesson carries greater ramifications downrange, in combat.

When it comes to leadership, every young man and woman are given opportunities to take on tremendous responsibilities beginning in boot camp and throughout their military career. Whether its planning a mission, leading an infantry team into a fire fight or managing a team to ensure the flight readiness of a multimillion dollar aircraft, tank or planning logistics to move a battalion from one place to another. These assignments hone both management capabilities and teamwork are transferable and essential skills in preparation for success in any endeavor in or out of the military.

I have spoken with thousands of veterans and it surprises me that many veterans think franchising is all fast food and are surprised to find there are franchise opportunities across seventy-five industries. Everything from security, printing, painting, financial services, healthcare, early childhood education and many, many more.  My company Veteran Franchise Advisers (VFA) provides free financial assessment, franchise education, and skills assessment for veterans and their families to match them with franchise opportunities that fit their finances, lifestyle and goals. We coach veterans throughout  the franchise search and acquisition process and connect them with financing, legal, accounting, and business planning resources near to help prepare them to start their own business.

An excellent example of how VFA helps veteran achieve success in selecting a franchise are the Campbell’s. Terry and Debbie came to me in April of 2011. Terry was a career Army Armor officer.  He retired as a Lieutenant Colonel after 20 years of service.  During his career he commanded a tank company and cavalry troop; served on the military science staff at LSU; served as the US Exchange officer to the Australian Armour Centre; fought in Desert Storm as a tank battalion executive officer and ended his career as a Staff Group Leader at the Combined Arms and Services Staff School (CAS3) at Fort Leavenworth, KS. Debbie was a realtor. Terry tried his hand at insurance sales but became disenchanted with the company and left after six months to take a job as the human resource manager for a small family owned lumber and hardwood flooring company.  His prior experience with insurance sales helped him enormously with the benefits side of HR and his military experience provided him with the skills necessary to handle safety, training, organizational development and employee relations.  Eight years after he started work with the lumber company, the owners sold the company.  Under the new ownership the company began to grow rapidly.  In one acquisition the company doubled in size and expanded its geographical footprint from one state to four.  While it was an exciting time, eventually Terry decided it was in his best interest to gain more control over his future.   After five years with the new company he left to start his own business.

Terry and Debbie bought their Liquid Capital franchise in November of 2011.  Clients are critical to their success, so their clients take priority, but at this juncture most of their time is spent networking to find the clients they need to succeed. In a recent follow up with the couple, I asked why they thought veterans make good franchisees and why they choose the particular franchise they said, ”Veterans bring a level of determination and will to succeed that is more prevalent than in the general population.  I don’t know if such folks are drawn to the military to begin with or if the training we get develops the confidence to adapt and overcome, but, either way my experience in both the military and civilian worlds leads me to believe this is one characteristic that more veterans have than their civilian counterparts. The founders of  the franchise and the other franchisees have similar values to those that veterans acquire through their service.  I don’t know how many, if any, are veterans but the level of integrity and camaraderie is far beyond what I have experienced outside of the military community”

I also asked them to share with me a recent success “Most recently we helped a young entrepreneur meet financial obligations and pay off debt by providing steady reliable cash flow for his accounts receivable.  Because of his billing cycle, he often had to meet two payrolls before being paid for his services.  Our purchase of his accounts receivable enables him to not only meet payroll but also afforded him the opportunity to pay down debt.” Said Debbie.

I then asked how VFA helped them and Terry said “Rich listened, learned what makes us tick and what would be a good fit for us.  He found several good franchises whose cultures fit us then gave us the room to figure out what would work best for us.  They never pushed and always learned from each encounter we had with a franchise as to what it was that would excite us in a franchise relationship.  He refined his search based on what he learned and each succeeding franchise came closer to meeting what we were looking for.”

My final question to the couple was what advice they had for veterans thinking about franchising. Terry responded with “One of the advantages a franchisee has is he is encouraged to talk with as many current and former franchisees as possible and check out the claims in the franchise disclosure document (a good franchise broker such as Veteran Franchise Centers can help here).  It is called due diligence.  You owe it to yourself to learn as much about the franchise, both good and bad, by calling current and former franchisees is a good way to learn as much as possible.  It is also critical to find good professional advisers such as attorneys or accountants and engage with them early on in your search.  They can help you establish the true cost of getting started and help ask the right kinds of questions. You also need to know the market in which you are planning on serving. Make sure you  set yourself up for success by ensuring your market will support the type of franchise your are looking to open.”

It is without question that veterans make great franchisees. One of the challenges for veterans coming out of the service is they don’t know what they don’t know.  For example, Many veterans are unaware they can use their Thrift Savings Plan (TSP) or 401K  to start a business.  Many don’t know that there are franchises investments that start at around $10,000 and that there are loan programs that will loan up to $150,000 with 10% down.

Franchising can be an exciting journey of independent ownership, while still having the support and structure of a proven business model. With its rapid training, proven systems and need for operational excellence franchising may be an excellent career path.

If you are a veteran and thinking about starting a business, franchising is an option worth exploring.