Passive Business Income – Dream or Reality
Franchise business consultant Jim Judy
Four reasons why Baby Boomers love semi-absentee franchises
Read the news today and you’ll see a countless number of stories on how baby boomers are handling retirement. Did they save enough money for the lifestyle they expect? How have they structured their nest egg? Will they be able to retire at all, or will they have to work until they die?
As a franchise consultant, I work with dozens of baby boomers who are either approaching or have eclipsed the retirement age. They are considering entrepreneurship as a means to bridge the gap between employment and retirement, create a legacy, generate income and live a dream as a small business owner. Many of them have worked full-time jobs for 30 or more years, so they have no interest in spending their golden years held hostage by a business that demands constant attention.
Enter the semi-absentee franchise.
A semi-absentee franchise is essentially a business that doesn’t require a full-time commitment, allowing the business owner to focus on other obligations or interests. Though it may require the same initial investment and time commitment of a full-time franchise, it becomes only a part-time commitment once operation begins. Semi-absentee franchises often take longer than traditional models to turn a stable profit and have higher operating costs due to the need for hiring supervisors. However, there are some significant reasons why this can be a terrific option for boomers preparing for their next chapter.
Purchase the franchise with retirement funds: Thanks to the federal government’s Employee Retirement Income Security Act (ERISA), people can roll their 401K or IRA into a plan for a new business or franchise without penalty or extra taxes. It’s your money, so you don’t have to tolerate outside investors or cumbersome interest rates while paying off your loans. Just remember, the transfer of funds can be tricky, and there are rules to follow, so be sure to consult a professional if you choose to purchase a franchise this way.
Limited work hours: Semi-absentee franchise owners work as little as 10 hours per week, handling oversight and management of key employees that will handle the day-to-day operation. Owners can dedicate a few hours a day or a few days a week to handling their responsibilities, then devote the remainder of their time to family, travel, work or other passions. Keep in mind that this type of management should only be used with franchise systems designed for semi-absentee ownership. Attempting and implementing a semi-absentee plan into a business model that was meant for full-time ownership participation could be disastrous.
Investment diversification: Diversification is a key strategy to reduce overall risk in an investment portfolio. Most people are familiar with the application as it refers to investing in stocks, bonds, funds, etc., but the term also applies when expanding your portfolio to investments in real estate and business. A semi-absentee franchise system doesn’t require you to be an expert on the franchise’s offering, since you will have a management team in place to handle your product or service. You can manage it as you would an investment portfolio with a general understanding of business and willingness to follow the franchise’s proven model of success.
Scalability: Part of the draw of franchising in general is the opportunity to purchase entire territories in order to open multiple franchises. Growth is exponential, as opposed to the same sales-cost growth you would see in more linear business models. If you are someone who likes the idea of building a franchising empire, the semi-absentee model allows you to own multiple units without significantly increasing the amount of hours necessary to succeed.
Ensuring success in a semi-absentee franchise model requires careful planning. You must have the right skills, recognize the risks and select the right business for your life goals and dreams. Consulting with a business coach or a Business Consultant In Australia and before investing can help you make the correct choice for your lifestyle and needs.
About the author
Franchise business consultant Jim Judy has spent the past 20 years in the franchise industry,
gaining insightful knowledge and a keen eye for opportunity. His passion is developing
relationships with current and hopeful entrepreneurs to assist them on their journey to franchise
business ownership. Jim leverages his experience, success and close relationships in the
franchise industry to provide valuable consultation free of charge to entrepreneurs looking to
explore the benefits of a franchise. To learn more, call 919-233-3534 or email
Category: Blog
