As with any industry, franchising is packed with lingo that makes perfect sense to insiders and causes everyone else to raise an eyebrow and wonder what they missed. I have found that “semi-absentee franchise” is one of those phrases that requires a more detailed description.
It is all about time commitment
As you consider making a business investment, there are 3 different levels of time commitment – “active”, “absentee” and “semi-absentee”.
When you invest in an “active” involvement franchise you will be making an investment of both financial capital and time. Franchises that fall into the “active” category will necessitate your involvement in the business on a full-time basis – 30, 40 or more hours per week. As the business matures, your time commitment may drop, but you should expect a full-time commitment for at least 2-3 years.
At the opposite end of the spectrum are true “absentee” investments. In all honestly, there are very few truly “absentee” opportunities. In my career, the only ones that I have encountered revolve around real estate where there is a property management company responsible for the operations.
In the middle of these two extremes, you will find the sweet spot of “semi-absentee” franchises. These are businesses that have been structured so the owner can be successful with a time commitment of 10 to 15 hours per week on a regular basis.
There are common characteristics of semi-absentee businesses
As you start to explore “semi-absentee” franchises, you will find a variety of alternatives from very different industries. However, they have common operating characteristics. The primary ones are:
• Manager run on a day to day basis
• Typically retail based operations
• Almost always setup to become multi-location businesses over time
• Owners do not need prior industry experience for success
Certain industries thrive with “semi-absentee” ownership
There is a select group of industries that have exhibited continued success with a “semi-absentee” ownership model over time. Some successful “semi-absentee” industries include:
• Hair care with brands such as Great Clips, Supercuts and Sport Clips
• Beauty including market leaders like Massage Envy, European Wax Center and Deka Lash
• Fitness with diverse players including Club Pilates, Anytime Fitness and Planet Fitness
Semi-Absentee owners have limited (but critical) responsibilities
As we discussed earlier, “semi-absentee” owners have a time commitment to the business of 10 to 15 hours weekly. These hours are very flexible and are usually set by the owner to fit around other work and family commitments. For example, an owner may work 2 hours each on Tuesday and Thursday evenings and a half day on Saturday. Within these hours, the key responsibilities to complete are:
• Supervising the store manager
• Implementing the marketing program
• Reviewing operational and financial performance
• Completing certain administrative tasks
Many investors succeed with “semi-absentee” franchises
There is a wide variety of investors who succeed with “semi-absentee” franchise opportunities.
• Employees who are seeking to build incremental income
Many employees have reached the peak of their corporate income opportunity. Owning a “semi-absentee” franchise provides the opportunity to earn income that can pay for college, fund a vacation house, supplement retirement savings or enable home renovation projects.
• Corporate executive and managers who are seeking a “soft landing”
That is, they invest in the business today and use the next 12 to 24 months to build the business, ramp up the profitability and then leave their job once there is stable income.
• Downsized employees
Because of the lifestyle flexibility, these candidates can start the business on the side while continuing a job search and moving into a new position.
• Existing business owners seeking diversification
Because there is a limited time commitment and multi-unit growth opportunities, business owners are attracted these businesses for long-term income diversity.
Do you want to learn more about “semi-absentee” franchise opportunities? You can contact Chris Cynkar by telephone at 412-877-2000, by email at ccynkar@franchoice.com or visit www.chriscynkar.com.
