Franchising for disadvantaged individuals
Writing about the SBA loans for new and expanding small franchises I met the list of public goals. It was said that in order to get a bigger credit your company needed to meet some of these goals. Some of them are easy to meet; the others are difficult not only to meet but also to prove that you can do it. But one of them has attracted my attention – when small franchise business is trying not only to earn money or to help in achievement of personal goals of its owner but helps those who can take care of themselves. I’m speaking about those whom we usually call “disadvantaged individuals”. This article is devoted to them and their ability to participate in business and in life in general by entering franchise system.
In general there are two different points of view regarding disadvantaged individuals. The first group of people thinks that it’s better not to attract attention to them at all. They say that this will disgrace them and hurt their pride. The people with the opposite opinion believe that we need to do as much as possible to help them; we need to create the special conditions in every sphere of life and business is not exclusion. As for me I’m somewhere in between these two extremes. And speaking about franchise business I think that there must be created some preferences for such group of people. And these preferences have to be results from the obstacles that disadvantaged individuals face.
Below I write about that obstacles and the way to decrease the influence of them on the disadvantaged individuals while starting their franchise business.
1. Obstacle: Little knowledge in franchise sphere. This problem is divided into the several sub-problems.
1.1. Availability of information about franchise concept in general. Many of that people have very little or even no business knowledge. As most of them have at least one problem concerning communication (reading, watching, hearing and so on) they get the information from doubtful sources – their friends who are not in business, relatives or neighbors. As I think the society has to create some means of information to provide reliable, trustworthy facts about advantages and disadvantages of franchise business, opportunities and special programs for the disadvantaged individuals. These means of information has to be technologically different to cover as many of such people as possible.
1.2. Sufficient background necessary to understand, to manage and to operate a small business franchise company. This obstacle includes not only general information but also real business skills. I want to mention that disadvantaged people are very vulnerable and they may consider ordinary business problems as their personal failure. I think that the role of the society in this case is to help them to avoid those problems. Maybe we can think about some business incubators or services of special consultants for franchises managed by disadvantaged individuals (financed by the money of franchise associations and small business organizations).
2. Obstacle: Ability to compete with non-disadvantaged franchisees. This problem can be characterized as psychological even more that economic or medical. Some of such people consider themselves incapable to start something themselves. But if they see the results shown by those who are in worse conditions they can cheer up. I suppose this to be the main role of the society – to show disadvantaged individuals that from business point of view they are absolutely equal to ordinary people. And even more! The statistics proves that people who have health problems in one sphere usually are extremely talented in the other.
And one more statement: being disadvantaged they can better understand the needs and want of other disadvantaged individuals. As a result their business can meet that needs much better; and it’s the first step to better competitiveness.
3. Obstacle: It’s too expensive as disadvantaged individuals have more expenses to cover in comparison to ordinary people. I agree that this is an obstacle; but on the other hand franchise business can bring them additional money in the form of profit. I think that government has to support (and I know that in many countries it does) the willingness of such people to start their own business as it will help to achieve the long-term goals too. Also I believe that franchisors must include special paragraphs in their franchise programs for disadvantaged individuals buying the license from them to make it cheaper…
4. Obstacle: It’s physically difficult for the disadvantaged individuals to collect and to provide all the necessary documents to start-up the franchise business. I think that authorities must pay attention to this problem too. We create special parking slots for such people, help them in the shops and so on. I think that there wouldn’t be any problem for all sides (I mean banks, franchisors, lawyers, local authorities and other institutions) to introduce some light procedures for such groups of people. It’s not only a noble but also a good economic decision. Will anybody argue?
Certainly there are more other obstacles for disadvantaged individuals to start their franchise business. Here I mentioned only the main as I think…