Buying a Franchise Can Be Your Path to Entrepreneurial Success, Says Industry Veteran Gary Prenevost

Entrepreneurs hate wasting time — which is one reason why franchise ownership is such a popular start-up path.

"Franchising isn't just about buying a business; it's a time-compression strategy," says franchise expert Gary Prenevost in the latest episode of The Unsure Entrepreneur Podcast. He describes franchise ownership as a guided path where franchisees benefit from established systems, coaching, and a community of other franchisees — all of which save the entrepreneur money and time.

With over 30 years of industry experience, Gary is the President of FranNet Southern Ontario and Eastern Canada, a board member of the Canadian Franchise Association, and the author of The Unstoppable Franchisee, a USA Today top-selling book that outlines a blueprint for achieving sustainable success within the franchise model.

Gary shares some compelling statistics during the discussion: "45% of retail sales in Canada come from franchises, and in the U.S., the figure is about 50%." He points out that although well-known brands like Tim Hortons and McDonald's dominate the public's perception, the franchise model extends across more than 60 industries, with over 70,000 franchise units operating throughout Canada.

"It's about finding the right fit for your skills and lifestyle."

"It's about finding the right fit for your skills and lifestyle," Gary says, stressing that the journey to owning a franchise should start with a thorough self-assessment. He helps potential franchisees to carefully evaluate their strengths, weaknesses, and lifestyle preferences. "It’s not just about finding a business; it's about finding the right fit for your skills and lifestyle," he explains. Factors such as time availability, financial resources, and long-term goals play a crucial role in determining if franchising is a suitable path. "You need to understand what kind of work energizes you and what drains you because owning a franchise is a long-term commitment," he adds.

Best of all, Gary's guidance comes at no direct cost to the buyer. His company is compensated by the franchisor that the buyer chooses to partner with, similar to how real estate agents are paid by sellers. If a client decides not to move forward with a purchase, there are no fees.

Three valuable insights from the interview:

1. While businesses started from scratch have a 50% failure rate, franchise businesses tend to have a much lower failure rate of under 20%.

2. Franchising offers options for different investment levels, from smaller service-based operations under $50,000 to large brick-and-mortar businesses that require millions.

3. The best franchises provide comprehensive training, established systems, and a strong network of other franchisees for support.

   
   

Gary also discusses the importance of aligning a franchise’s support systems with the buyer's skills and experience. He advises potential franchisees to choose a franchise where the resources and training offered can help the buyer acquire missing talents — for example, a new franchisee may not have much experience managing a team of young employees. "A great franchise match is one where you can leverage the franchisor’s resources and training to bridge any gaps in your expertise," he notes, emphasizing that a franchise investment should be viewed as buying into a growth-oriented system.

"Don’t use all your money to get the business open. Plan for six to 12 months of reserve funds to avoid undercapitalization."

For those concerned about funding, Gary highlights the Canada Small Business Financing Program which offers loans of up to $500,000 with a 75% government guarantee for franchise investments. This program reduces the financial risk for new franchisees and makes getting started easier. "Don’t use all your money to get the business open. Plan for six to 12 months of reserve funds to avoid undercapitalization," Gary advises.

For anyone considering franchising, Gary’s advice is clear: start with some introspection. Assess your skills, time availability, and financial situation. While franchising offers a structured route to entrepreneurship, understanding your personal goals and limitations is crucial for success.

Have a listen to this fascinating interview on The Unsure Entrepreneur.

Learn more about Gary and his franchise resources at garyprenevost.com or through his video series on transitioning from employee to entrepreneur.

[Photo caption: Gary Prenevost; Book image of The Unstoppable Franchisee available on Amazon]