Jervis B. Webb Company designed, manufactured and installed 2.5 miles of conveyors and peripheral equipment at NB Power’s Belledune Generating Station. The bulk handling system transports coal from dockside to the power station at a rate of 2700 tons per hour.
And in fact, when the first ship was unloaded, coal was sent to the storage area at peak rates above 2800 tons per hour. It’s another success project for Webb, a global company that is dedicated to providing the industry with the most reliable coal handling systems.
Belledune power station is a 450 MW coal-fired power generation station for Energie NB Power in Belledune, New Brunswick, Canada. This station relies on coal brought in by ship for operation. Coal is transported from the ship unloader through nearly 2 miles of gallery, 5 transfer houses and the crusher building by seven 5-foot wide belt conveyors. Coal is conveyed to either the concrete stackout tower for outside storage or to the covered storage area. Once in storage, the coal can be recirculated between storage areas or reclaimed to the boiler house by a system of 7 belt conveyors and 2 en masse conveyors.
Major structures and equipment include: 2.5 miles of belt conveyors, 1.8 miles of gallery, five transfer houses, crusher building, concrete stackout tower, vibrating feeders, tramp iron detectors, magnetic separators, belt weigh scales, coal sampling system, frozen coal cracker, double roll crushers, surge weigh bin, two en masse conveyors, dust collectors, furnace ash and pyrites removal system, fire protection and sprinkler system.
If you need more information on our systems, then you should definitely consider checking out our Internet website. There, not only can you discover everything you need to know on , but also see actual photos of the belt conveyors that we are so proud of!
I make money online every day, whether I work or not. It was not always this way. I started out in 2003 online after years of success in the real world. I brought my business savvy and experience to the Internet and was able to succeed relatively easily. Most people don’t have my experience and because of that, they are unable to make even that first dollar. I will show you how to do it. Getting started only requires that you have the willingness to learn and apply what you have learned.
Let’s start with a simple method of income generation. There are many tasks involved in getting a website up and running. First there is the initial setup. Once the site is setup, you need to promote it and get visitors or you will not make any money. This is where you come in. Most promotional tasks are tedious and very time consuming. Web entrepreneurs are busy people. You can help them for a fee. You can promote their websites for a fee. You may be thinking that you don’t know how to promote a website, so how can you sell this service? That is simple. Let your client tell you what to do. Put up a classified advertisement on webmaster forums like DigitalPoint and SitePoint. Go to your favorite search engine and search for internet marketing forums, make money online forums and such. Post ads on each of these. Many will be free. You will set your fees according to ads that are like yours. Once you get some clients, you will be able to raise your fees if you offer good timely service.
Another way to make money online is to write articles and blog posts and ebooks. If you took the first tip I gave you to heart, then you already have a list of websites to post your ads to. Use this list and offer your blog posting and article writing services. Writing articles is really not all that difficult. You do some research on the topic you are given and simply put the information into your own words. Use a conversational tone just like you speak to your friends and family. Just make sure to omit any protestations of love in your articles unless you are writing about how to get your ex-girlfriend back. If you produce articles on time and of acceptable quality, you will have many repeat customers. Those same customers will come back to you over and over again.
Let’s say you really stink at writing. You can be an article writing broker. Here’s how this approach works. Most Internet marketers work on a quantity basis. What I am saying is that they need a lot of articles written in a timely fashion. Here’s where you can make some money. Go to DigitalPoint and find authors willing to work for $3/article. There are many who will. You will need around 10 authors. Tell them that you will have continuous work for them and get them on board. Next, offer article packs on the forums at 50 or 100 at a time for $4 or $5 each. You will be making money online without having to write a single article.
For many more ways to make money on the Internet, visit our Internet Marketing Blog to with our tips and advice. For a proven, easy and repeatable business, download our free ebook today and start making money with blogs.
Millions of people dream about owning their own business. Having the independence that being your own boss brings, the security that no one can fire you, enjoying a good income – and for the most successful – the accumulation of wealth and prosperity. Unfortunately, the cards are stacked against a new small business making it big – or making it at all. An endless stream of problems makes competition from large, sophisticated chains too intense. Many new start-ups end as failures.
represents a different approach to starting a business. For an upfront franchise fee plus ongoing royalty payments, the parent company teaches its business model and methods to the franchised-operator who shoulders all operating and financial responsibilities of the outlet. Some statistics are impressive: it is said over 40% of all U.S. retail sales are through franchised establishments. While franchise giants like McDonalds, KFC, H&R Block and Radio Shack are familiar, household names, franchises are available in a wide range of industries. The list of 3,000-plus companies selling franchises span over 100 different industry categories.
American Dream … Or Nightmare? But just as franchising represents a chance to get rich, it’s also a chance to get stung. An alarming number of franchised operators make less than the minimum wage, working seven days, sixty to eighty hours a week, pursuing an expensive and elusive American Dream that turns into a nightmare. Since the ongoing franchise royalty payment comes right off the top, as a percentage of gross sales or a fixed minimum amount, the franchise company gets an assured revenue stream, even if its franchised units are operating unprofitably and are sold over and over again to new, unsuspecting buyers. The internet is filled with comments of the many people who lost $250,000 and more on concepts like eBay Drop off stores (iSold It), 30 Minute Fitness concepts (Curves), The UPS Store, etc. Yet many of these companies continue to sell and resell franchises over and over again. How do they accomplish that? Because there are enough people who think they can “believe” their way to success, even with a concept or business that’s not working in the marketplace. As discussed below, in many cases franchise investment decisions are incredibly based on emotionalism, not on business logic or even common sense.
Ownership And Being Your Own Boss? Pride of ownership and being your own boss are highly touted phrases in franchise recruitment ads. But these are more fantasy than reality. Although you get all the financial exposure, headaches and stress of business ownership, what do you really own? A franchise owner is merely licensing a trademark (or service mark) from a company that dictates every detail of business operations. So the real boss isn’t you, but the company that sells you their franchise rights . . . and sea of franchise obligations.
Equity Build up? But at least you’re building up equity, the ownership value of the business as a going concern beyond your investment of money, to compensate for all those years of hard work and long hours – right? Wrong – at least in the world of franchising. The franchise company reserves rights to acquire your entire business at below wholesale prices if their contract is not followed precisely. The acquisition rights provide for predetermined asset-based valuations, like book or liquidation value. These valuation methods provide bare minimum compensation (the used value of some file cabinets, office furniture, equipment, etc.) and are not generally used to determine the selling price of any business.
Absolutely no compensation is paid for established goodwill, the value of a business that is generating $X in profit or cash flow every month after years of effort, investment and expense – thus eliminating the most valuable ownership asset. Of course, you may be able to sell your franchise to a third party for a sales price that includes an earnings-based valuation. But that’s possible only if: (a) you can find a buyer who is willing to live within the complexities of a franchise relationship, and (b) you happen to own a franchise that’s showing healthy profits.
What follows is a bottom-line franchise checklist and tips compiled by franchise attorney and franchise expert, Mr. Franchise, based on reviewing over 500 franchise offering circulars and twenty-eight plus years of experience in the franchise industry – including ownership of a very successful franchise. These factors to consider in making a franchise investment will help you eliminate 95% of the companies you are considering. Then, you can concentrate your efforts on the 5% “cream” of the crop” companies that may deserve consideration. This franchise checklist assumes you’re suitable for and willing to live within the confines of a franchise relationship. It also assumes the franchise company:
(1) has itself successfully operated the concept being franchised for at least five years at multiple locations; (2) is not plagued by franchise litigation and franchise lawsuits from disgruntled franchise owners; (3) does not have unusually high franchise attrition rates (owners who have “left the system”); and (4) has a balanced, fair franchise contract. SOLD It – An American Dream That Turned Into A Nightmare An example of a franchise company in trouble that failed to meet basic threshold standards is iSOLD It, an eBay drop-off store franchise. The company started its one and only company-owned store in November of 2003. Just weeks later, on December 10, 2003 they filed an application to sell franchises. The California Department of Corporations didn’t say “What are you thinking? You’ve only been in business a couple weeks, how can you even consider selling franchises?” Nor did they require this be disclosed as a risk factor on the cover page of the Franchise Offering Circular, as it should have. Disclosure responsibilities ultimately rest with the company (and its attorneys), and this will become one of many issues in future franchise litigation.
Instead, the Department simply collected its $675 filing fee and issued an order declaring the franchise registration effective the next day – on December 11, 2003. Then the magic of franchise marketing took over. By 2006 the company had nearly 200 franchised drop off stores in operation and was touted by Entrepreneur Magazine as #1 in their list of “Top New Franchises for 2007” and #17 on their “Hotter Than Hot” franchise list. Entrepreneur Magazine, which requires franchise companies to submit their FOC’s (Franchise Offering Circulars) for supposed review each year before they’re listed, didn’t consider the high attrition rate (franchise owners leaving the system) or the fact that the audited financials in their FOC showed the company hadn’t operated profitably since 2004 as serious negatives and awarded iSold It the #1 listing for Top New Franchises of 2007. How did all of this happen? It’s yet another bizarre reality in the world of franchising.
The franchise company’s audited financial statements for the year ended 12-31-05 showed an operating loss of $1.1 million. Nine months later, in September of 2006, the net operating loss mushroomed to over $4 million.
In its November 3, 2006 Franchise Offering Circular, the table in Item 20 disclosed a total of 10 franchise owners leaving the system, yet a hand count of Exhibit D-3’s “Former Franchisees” revealed a significantly different number – 44. A similar “discrepancy” exists about franchise transfers. Item 20 says 12 transfers whereas Exhibit D-3 discloses 27.
In a long overdue letter distributed to franchise owners on April 5, 2007, CEO Ken Sully painted a dire picture of an American Dream that had turned into a nightmare. Mr. Sully’s letter admitted the company has not been profitable since 2004 (according to the audited financials, the company showed its one and only operating profit of $356,286 in 2004 before the precipitous downward spiral of 2005 and 2006). Over 60 franchised stores have closed and many more are struggling for survival. Mr. Sully observed “Tragically, many individuals who believed passionately in the potential for the category have lost sizable investments, including homes and retirement savings.”
Lost homes and retirement savings? How could such a travesty happen? I counseled a number of persons considering an iSold It franchise and warned all of them against the investment. Fortunately, they followed my advice. The concept was never proven in the marketplace before franchise efforts began, violating the most basic Franchise 101 precept. I also felt the management team lacked strong franchise credentials and the five-day training program was woefully inadequate. Finally, the franchise company was operating increasingly in the red and had a high attrition rate (owners leaving the system). It didn’t take a lot of brain power to see this was an accident waiting to happen. I predicted the bubble would burst and, sadly, it did.
Common sense could and should have prevented so many people from losing so much. Unfortunately franchise sales persons appeal to emotions (passions and potential, to use Mr. Sully’s terms) and strive to keep common sense and business logic out of the buying equation. If a franchise company is able to obtain a ranking on a media list, the sale is even easier. Reprints of high rankings on lists, like Entrepreneur Magazine, are included in the package given to franchise buyers, who are lulled into a false sense of security and begin to stumble over each other in a rush to sign up before someone else takes their desired territory (another favorite closing technique used to sell franchises).
iSold It! amended its FOC at the end of May, 2007 to add some long overdue risk factor language to the cover page of its Franchise Offering Circular. Hmmmm… maybe they read my comments above and did a little research. The new FOC cover page risk factor language says their “franchise system is still new and unproven.” That’s very interesting. How can they say a franchise system, that’s approaching its fourth anniversary, is “still new?” Maybe they’re looking at things from a ‘how old is our universe’ perspective? The word “unproven” is another play on words. The system is most certainly proven in the sense that many people, to quote Mr. Sully, “have lost sizable investments, including homes and retirement savings.” So why not use this quote directly in their Franchise Offering Circular? Answer: can’t sell any franchises that way.
In an August 31, 2007 Business Week article, CEO Sully claimed it wasn’t necessary to disclose these risk factors in the FOC. His reasoning: “We told everybody that this is sort of like the wild, wild West” he says. “It’s a brand-new concept and nobody knew for sure where it was going.” Disclosure was added to the UFOC recently, he says, “because of the number of stores that weren’t understanding the complexity of the business.” Hello? You don’t tell your franchise investors after the fact what you were required to disclose in the FOC before they bought so they could make an informed investment decision. That’s the purpose of franchise disclosure laws. And claiming written disclosure of risk factors in the FOC is not necessary if a prospective buyer hears a salesman’s verbal wild, wild West story ignores franchise disclosure responsibilities and is really an admission the company failed in this regard. With its amended FOC, the company incredibly continues marching forward with franchise marketing efforts.
Now, let’s consider the franchise checklist and factors to consider before any leap into franchising.
INDUSTRY TREND Is the franchise in a cutting-edge industry that is doing well currently and is projected to do well in the future despite any economic slowdown? Education and home-improvement services are stable categories. Food is over-saturated generally and, except in exceptional circumstances, is not worth the high investment, long hours, headaches and marginal income.
TOTAL INITIAL FRANCHISE INVESTMENT In general, don’t expect a franchise that requires a five-figure initial franchise investment to produce a six-figure income. As with most things in life, you get what you pay for. On the other hand, don’t assume a six-figure investment will lead to a six-figure income level. Be realistic and conservative. Is the total initial franchise investment range (including working capital) $125,00 or less; and the maximum investment less than $200,000? You can find solid companies in this investment range if you’re willing to look around.
Don’t forget to consider long-term financial commitments, particularly the real property lease (see discussion below under “LEASING AND LOCATION”). Also, the working capital estimate (called “additional funds” in Item 7 of the company’s franchise offering circular) does NOT cover operations up to the break-even point. It only covers a short initial phase (usually only three-months) of operating costs As the break-even point (where revenues cover all operating costs) may not happen for one, two or more years, knowing only what it’s going to take to get you through the first 90 days is not helpful – in fact it may set you up for financial suicide. In many cases, reaching the break-even point can require more reserve funds than the total initial capital investment. Don’t ever forget the name of Item 7 in the Franchise Offering Circular: “Initial Investment.” If you don’t have enough reserve capital to reach the critical break-even point, your entire investment will go down the drain and franchise failure occurs.
One franchise owner in a relatively low investment and low operating cost window cleaning franchise said his biggest surprise was how long it actually took his franchise to be profitable. Going in, he thought it would take 12 to 15 months. It ended up taking twice that time. Fortunately, he had enough reserve capital to make it there, but declined to say what his actual franchise profits or income level were once he reached “franchise profitability.” If you’re operating just above the break even point and making less than minimum wage, is that anyone’s definition of success?
REAL BUSINESS Is this a legitimate retail business, as opposed to a “work out of your home” operation? The vast majority of work out of your home concepts produce marginal income at best.
FRANCHISE MANAGEMENT EXPERTISE Does the management team of the franchisor (the company selling you the franchise) have executives with demonstrated past achievement and experience in operating a franchise company (not just persons who have sold franchises)? If not, this is a big RED FLAG. Many companies enter franchising and fail to realize they are in a brand new business – one requiring entirely different management skills and abilities to navigate franchise relationships. A seasoned franchise management infrastructure must be in place. If the franchise management team lacks strong franchise credentials, or does not receive ongoing advice from qualified individuals, you might as well take a trip to Las Vegas with the money you’re intending to invest. Your chances of making vs. loosing money are roughly equal.
NORMAL WORKING HOURS AND DAYS; SUFFICIENT FRANCHISE INCOME LEVEL Will the nature of the business allow you to work a normal five-day, forty-hour workweek? Life is too short for the seven-day, sixty to eighty hours a week, workaholic lifestyle that destroys health, family and pocketbook. Financially, we’ve calculated the true hourly rate for franchise owners who work these workaholic hours and discovered many are making far less than the minimum wage. One couple who operated a $200,000 fancy pizza franchise in an upscale mall were shocked to discover they were making fifty cents an hour each. Hardly an income level to recoup or justify the franchise investment. Many more fast-food franchise operators make even less, or operate at a loss until their funds, retirement savings, homes, etc. are exhausted. Buying a franchise in a non-food industry doesn’t necessarily improve the franchise profit picture. In a 2006 article “Mail Boxes Etc. Owners Fighting UPS Conversion,” a Mail Boxes, Etc. franchise owner who operated his franchise since 1993 reported profits for a typical MBE store like his were $16,000 per year after paying royalty and advertising fees to the franchise company. That calculates out to about $8.33 per hour for a forty-hour work week, approximately the wage of an entry fast-food worker.
Another major shortcoming of disclosures in the Franchise Offering Circular is not telling you how much money the franchises in the network are making. Instead of answering what is the most important question in a franchise investment decision, the franchise disclosure laws make this “optional” for the franchise company to answer or not. If they do answer this critical question, it will be found in Item 19. But don’t hold your breath – more than 90% of franchise companies “decide” not to answer this question. It’s another bizarre reality in the world of franchising. Although they collect complete monthly (and in many cases, weekly) financial profit and loss statements from their franchise owners, and know exactly how much their franchises are making (or losing), more than 90% decide not to share this information before you buy one of their franchises. A number of franchise salespersons have told persons asking this question: “the franchise laws don’t allow us to answer that question.” Nothing could be further from the truth.
And just because you’re a business executive making a 6-figure income now, don’t assume this income level will be duplicated in a franchise investment just because the company “approves” your application. One such executive, despite a plethora of negative feedback from current and past franchise owners who’d lost everything, marched forward with her franchise investment in a 30-minute fitness concept. Despite her 6-figure income, she didn’t invest a dime in professional franchise evaluation advice and stated she was taking a leap of faith, hoping to build her wings on the way down. Build her wings on the way down? Sound’s (and is) crazy, but this happens all the time. Due to the ploys of the franchise salesperson, too many franchise investment decisions are based on emotionalism. Prior business skills, business sense (and even common sense) are short-circuited. Needless to say, if this business executive made a similar investment decision for her corporate employer paying the 6-figure salary, she would be promptly fired.
MINIMUM NUMBER OF EMPLOYEES Can you operate the franchise business with 6 or fewer employees? Managing dozens (or in the case of some fast-food operations – hundreds) of minimum-wage teenagers who are constantly quitting or simply not showing up for work is a royal pain in the ….. Well, you know what we mean.
LEASING AND LOCATION For most retail franchises, the triple net lease of the location is the biggest financial commitment, larger than the total franchise investment. Yet, the typical real estate lease and its ramifications are not required disclosure in any Franchise Offering Circular (FOC). For example, an estimate that you’ll need 2,000 sq. feet of space with expected rental of $5 to $10 a foot per month is normally disclosed in the Franchise Offering Circular’s initial investment table as Leased Real Estate $10,000 to $20,000. A footnote to the investment table may say “assumes 2,000 sq. ft. at $5 to $10 a foot.”
But, that’s only the beginning of a much longer story. The lease is normally a 5 to 10 year triple-net lease. So, the financial commitment made when the lease is signed is at least $600,000 (at $5/foot for 5 years) to $2,400,000 (at $10/foot for 10 years). And this doesn’t include substantial, additional obligations to pay all of the landlord’s yearly property taxes, insurance, common area operating expenses, etc. With hundreds of thousands (or even millions) of dollars in financial obligations at stake, personal guarantees and other risks, more than just a warm, fuzzy feeling that everything will work out is necessary.
Key questions to ask here:
(a) is the franchise you’re considering one that can be operated in a low rent commercial business zone? Avoid franchises requiring the costly expenses and triple-net leases of a visible retail storefront and the extravagant rent associated with areas of high foot traffic, like shopping malls. You’ll sleep much better at night.
(b) What’s your total financial commitment under the lease?
(c) Do you have sufficient liquid assets (or a willing, sufficiently liquid third party guarantor) to meet the landlord’s lease qualification standards?
If you don’t, you might as well forget about investing in the franchise. Or even worse, getting involved in a questionable franchise and business model, then realizing you’ve made a big mistake – and discovering you’re on the hook personally for a $500,000+ lease obligation.
A related real estate variant is securing a lease with a sufficient term (with renewal options) to recoup your investment and make a profit. In July, 2005, an attorney in her mid-forties purchased an existing ice cream store franchise for $375,000 believing it to be a “once-in-a-lifetime opportunity.” Trading her briefcase for an ice cream scoop, she attended the company’s 11-day Ice Cream University and assumed operations of the ice cream store. Turned out it was an opportunity – but only to inherit a store with numerous problems. These problems included (but were not limited to) a lease that would expire the following summer and a landlord who’d previously announced the lease would not be renewed. Rather than pay the $100,000-plus in relocation costs, the attorney returned to the practice of law, but is still paying off $350,000 remaining on the loan taken out to buy the once-in-a-lifetime franchise opportunity. Although there’s a franchise lawsuit pending, it’s yet another case of “franchise fever” – this time attacking a professional no less. Who would ever commit to paying $375,000 for an existing retail franchise without checking out the l-e-a-s-e? Sound’s like another bad attorney joke, but I can guarantee she’s not laughing. Business fundamentals were ignored or forgotten in the rush to acquire the opportunity of a lifetime. And I’m willing to bet not a dollar was spent on competent, pre-investment franchise advice.
IMAGE AND LIFESTYLE How does flipping burgers, scooping ice cream and cleaning restrooms fit the image of what you want to do for a living? Investing in a franchise will be the most important financial and psychological decision you ever make. Many prospective franchise owners fail to realize they’ll be wearing virtually every hat at some point, from salesperson to bad-debt collector, from firing employees to bathroom janitor. The franchise owner is usually the first one to arrive in the morning – and the last one to turn out the lights late at night. And you’ll need to forget about corporate perks like paid vacations, paid holidays and sick pay. In their place, substitute financial pressures, unexpected events and money draining out of your savings and retirement accounts. Does the typical working day and responsibilities of the franchise you are considering fit your personal image and desired lifestyle? You can experience some of this BEFORE you invest by working for a couple weeks in an outlet owned by one of the existing franchise owners.
TRUE FRANCHISE VALUE Buying a franchise from a “blue chip” franchise company that has spent decades and hundreds of millions on advertising to develop their brand can make a lot of sense. These companies have “true franchise value” that compensates for the long-term disadvantages of ongoing royalty and advertising fund payments. Often these additional payments literally mean the difference between earning a profit and operating at a loss. In unknown franchise chains with little or no brand recognition, you the franchise buyer are building their brand from scratch, and are saddled with severe, long-term competitive disadvantages.
In these unknown franchise chains, you have to ask yourself a simple, common sense question. What value is the company giving you that you couldn’t learn on your own by working at one of their locations as an employee for a couple months? Franchise truth be told, what most unknown franchise companies are selling is just a business opportunity – teaching you how to get into a new business venture. But unlike a business opportunity seller that charges a one-time fee to help get you into business, they call it a “franchise” and charge ongoing royalty and advertising fees like they’re a McDonalds or other blue chip franchise company.
The reality is they’re not a McDonalds type franchise – not even close to one. In the majority of these lesser-known franchise chains, you’d be much better off starting an independent business on your own. You can learn most or all of their so-called “secrets” in the franchise interviewing process and by talking to (and possibly working a short time for) existing franchise owners.
FRANCHISE PROFITABILITY & “SUCCESS” Dr. Timothy Bates’ study released in 1993 by the Entrepreneurial Growth and Investment Institute in Washington, DC (and another study published in 1996) was the first to compare start-up costs, franchise profitability and franchise failure rates for franchised vs. nonfranchised firms. In his analysis of some 7,270 firms over the test period, Dr. Bates found that startup capital for a franchised business averaged $85,293 compared with average startup capital for nonfranchised firms of $30,156. In 1987 nonfranchised firms reported average pre-tax net income of $19,744 as compared to a loss of (-$1,548) for franchised firms. Dr. Bates concluded “Despite their larger revenues, much better capitalization, and their supposed advantages of affiliation with a franchisor parent firm, the franchisees lag behind cohort young firms in profitability and rates of survival.”
The franchise companies ignore both studies by Dr. Bates, pretending they never happened. Instead, other techniques are employed. For example, some franchise companies use misleading success statistics to sell their franchises. Their promotional materials say franchises generally enjoy a 90% success rate, compared to less than 20% for independent firms. These figures are based on unverified information supplied thirty years ago by a select, non-representative group of franchise companies. A full third of the companies receiving “questionnaires “ elected not to participate. There was no verification of any of the information supplied by the franchise companies, not even random, spot checking. Nor was any effort made to identify franchise companies who, along with the franchise owners in their chain, had gone out of business.
Even more recent “studies” saying nine out of ten franchise owners (90%) consider their franchise to be somewhat or very successful also suffer from serious methodological flaws. These were simply telephone surveys of franchise owners who were still in business and asked to say (with absolutely no definition of the term “successful”) whether they felt their business was “very unsuccessful,” “somewhat unsuccessful,” somewhat successful” or “very successful.” Franchise owners who had gone out of business or bankrupt were not included in the survey.
Even if terms are defined and a representative sample obtained, franchise owners can be a quirky group. Hence the need, as in Dr. Bates’ studies, for review of financial data. I remember evaluating an existing franchise for a client. I asked the current owner of the franchise if his business was successful. He said it was very successful. But his financial statements revealed a different picture. He’d never taken a dollar out of the business for himself, never made a profit in two years of operation, and was on the verge of bankruptcy. Another owner of a bakery franchise, interviewed by Business Week, says being successful in franchising means “adjusting your definition of success.” He says he makes a profit, but declined to say what it is, or if he’s ever recouped his $250,000-plus initial franchise investment. Incredibly, he insists he’s in business “for lifestyle reasons, not profit reasons.” Huh? Probably a quote from the company’s franchise recruitment materials. In the world of franchising “success” and “profitability” are very subjective terms. FRANCHISE BROKERS WHO FIND YOUR PERFECT MATCH? Does the franchise you are considering have its own in-house marketing department, or does it utilize outside franchise brokers? The use of franchise brokers is a definite red flag. First, it indicates the franchise company is not very serious about who it lets into the franchise network, or even worse, they’re desperate to sell franchises. Second, franchise brokers receive a substantial commission up to 50% or more of the franchise fee you’re paying the franchise company. Franchise Broker Realities: (1) Their service is definitely not “free” despite these and other similar misrepresentations. It’s really common sense – how could anyone offer a “free” service and survive in business? Unfortunately, the common sense part of the brain tends to short circuit when the franchise brainwashing process begins. The simple truth is if you buy one of the franchises they’re hawking, your money goes to the franchise company, then into the broker’s pocket. If anyone ever calculated how much time they spend to collect their $15,000 or $20,000 commission, it’s probably a lot more than a brain surgeon earns. (2) Franchise brokers definitely do NOT have your best interests in mind. They will do or say whatever they have to in order to close a deal and earn their commission.
Many franchise brokers claim they will help you find a franchise company that is the perfect match for you. In the beginning it sounds good. There’s some personality testing and review of your personal finances. At the end of the day, it turns out they only represent (and steer you towards) a handful of small franchise companies you’ve never heard of before. A detailed analysis often reveals these highly touted franchises produce mediocre or even below minimum wage financial performance. Yet franchise brokers don’t mention this, and individuals continue to rely on their recommendations, believing the broker represents them. Nothing could be further from the truth.
Also, many franchise brokers call themselves franchise consultants. A franchise consultant is usually an independent adviser who offers advice to others (usually franchise companies or firms that want to franchise their business) for a fee. This makes their advice more impartial in theory as long as they are not compensated by third parties. Because they are not legally required to disclose actual or potential conflicts of interest, it’s important ask questions. For example, if you’re using a franchise consultant who is recommending the “best franchises,” are they paid anything by the companies on their list? This could be a commission, kick-back or consulting fee. As mentioned, many franchise brokers call themselves “franchise consultants” to hide their true identity. So, make sure if you’re dealing with a franchise consultant, he or she is not really just a franchise broker in disguise.
FRANCHISE DISCLOSURE LAWS The franchise disclosure laws, while requiring franchise companies to give you certain, limited information, don’t come close to protecting your interests. For example, as discussed above, Item 7 of the Franchise Offering Circular only requires an estimate of additional funds for 90 days as part of the investment information. But economic reality is you need to know the additional funds you’ll need to reach the break-even point, which can be years away, or your entire “initial” investment will go down the drain. You’d think this type of information would be required by franchise disclosure laws, but it’s not.
FRANCHISE REGISTRATION LAWS Don’t ever assume that because a company has registered its Franchise Offering Circular in your state, someone at the state has approved or reviewed the document in your favor. Franchise registration is obtained by simply forwarding documents and paying a filing fee – period. In most cases, franchise offering circulars are given an extremely limited review to ensure state-specific disclaimers are present.
I remember filing a registration application for a new franchise company in a state with a reputation for being one of the “toughest” franchise registration law states in the country. After the three-week review period set forth in the statute had gone by, and not hearing anything, I called the examiner assigned to the application. After looking through his files, he finally found my client’s offering circular and application. He apologized for entirely misplacing the file and promised to immediately review the application and call me back. Ten minutes later, he called to say he’d finished and was making the registration effective that day. Ten minutes of review and the franchise company was given the state’s green light. This is not an isolated case – it happens all the time.
WHAT STANDARDS MUST A FRANCHISE COMPANY MEET TO SELL FRANCHISES; ARE THERE ANY REQUIREMENTS TO FRANCHISE A BUSINESS? Incredibly, the answer is – none. There are no minimum standards or requirements to franchise a business except preparing a Franchise Offering Circular. It’s yet another bizarre reality in the world of franchising.
You and I could have no background in any business, form a new corporation or LLC, capitalize it with only $1, put together a Franchise Disclosure Document and file it with any franchise registration state. While the offering may be subject to an impound or escrow requirement because of the low capitalization ($1), we’d still get “registered” and be able to sell as many franchisees as we want.
In these 14 franchise registration states, we may not be able to receive any money until each franchise actually opened, but simply posting a bond would alleviate this difficulty in the franchise registration states. And in the vast majority of states there are no franchise registration laws, so we’d be able to sell franchises and collect fees with impunity once we compiled our Franchise Offering Circular. The federal FTC Franchise Rule doesn’t protect against this risk either – it only requires disclosure (i.e. provide a Franchise Disclosure Document) and has no registration component or minimum standards for franchise companies.
Basic investor protections and requirements found in both federal and state securities laws for over 50 years were never carried over to franchise investments. While most non-blue chip franchise companies could never even qualify to sell you a single share of stock in their company, they are entirely free to collect unlimited franchise fees, ongoing royalties, equipment and other purchases, as well as cause you to incur financial obligations totaling hundreds of thousands of dollars, or even millions in some cases. This isn’t information you’re likely to find in the glowing articles about franchising and franchise companies prevalent in the media.
CLOSING REMARKS Remember, you are the only guardian when it comes to your franchise investment. It’s definitely an environment where the phrase “Buyer Beware” applies. So, before you sign on the line and make what will undoubtedly be the most serious financial and emotional commitment of your life, get all the facts and figures.
One couple I counseled after-the-fact, invested $2 million in a new franchise company. The contract they signed gave them no right to terminate, no matter what the franchise company did or didn’t do. Of course, the contract gave the franchise company unlimited termination ability, a right it had exercised. The franchise company’s management team had no one with experience in running a franchise company. Incredibly, the couple had not spent a dime on legal or business advice before investing $2 million. The once friendly franchise company had transformed into a formidable foe and was poised to take over their franchise. Sadly, this happens too frequently in franchise investments. Decisions are made on fuzzy feelings and emotionalism. In an effort to save a couple thousand dollars, franchise investors risk homes, retirement savings, everything they have. Then they scratch their heads in amazement later on after inevitable and often horrific problems develop, wondering how they could have been so nearsighted.
Another indispensable level of inquiry is whether you’re getting true franchise value and whether you’d be better off doing the business on your own. In the overwhelming majority of franchises touted by unknown companies, franchise value isn’t there and doing the same thing independently makes better economic sense and actually decreases the risk of failure.
Finally, and this applies to franchise investments as well as investing in any business venture, develop a plan to succeed but also plan a franchise exit strategy that minimizes financial risk in case things don’t work out. Both plans need to be thought through before the investment is made. Don’t wait until problems develop to start thinking about a franchise exit strategy – by then it’s usually too little, too late.
For more information, visit the Franchise Foundations Website.
Known in the industry as Mr. Franchise, Mr. Murphy is an internationally-known franchise expert, author, and instructor. For the past twenty-eight years he has specialized exclusively in the franchise industry and owned a very successful franchise in the home improvement field. He has written over 30 publications, including four books on franchising and one book on trade secrets. Mr. Franchise has drafted, reviewed and negotiated more than 500 franchise offering circulars and instructs franchise company personnel in best franchise practices. He also teaches franchise, licensing and intellectual property courses to attorneys. Mr. Franchise is a franchise attorney and Director of Operations for a San Francisco-based professional law corporation.
The internet is littered with every kind of get-rich-quick con and scam you can imagine.
There are the Nigerian 419 schemes, forced matrix ‘opportunities’ that would require maxing out the entire human population for just 10 percent of participants to ever see a penny, there are over-hyped Pay-per-click and Adsense scams, fake MLM and network marketing ‘opportunities’, and the list goes on and on…
At times like these, desperate home-based business seekers become easy prey for vultures pushing scam products and fake ‘opportunities’.
How to get scammed
- Accept every offer and every promise at face value.
- Give your money to others without thinking things through.
- Let emotion and promises of ‘instant wealth’ carry you along.
- Don’t bother reasoning through on whether or not a program might be a scam.
- Jump in with both eyes wide shut.
Those are sure fire ways to get taken advantage of. But what if you don’t want to be the next victim? How can you really know in advance if a program is a scam or not?
What You See Is What You See
An often overlooked tale tell sign that an ‘opportunity’ is a scam are the products themselves.
Are the products truly valuable? Can the products be sold at its current pricing, or at all, without the ‘opportunity’ attached to it?
If the answer is no then use the R.L.H. formula for protecting your wallet. R.L.H. stands for run like you-know-what (heck).
Also, look to see if there are outrageous fees or ‘qualifiers’ before you can receive a penny in pay.
And finally, does the program tell you EXACTLY what you will receive a commission for promoting, before they take your money? I’ve lost track of the hundreds of scams that have been sent to me saying ‘give us $39 and we’ll tell you what this biz opp is’. I don’t think so buddy…
RLH!
Those are the three most common giveaways that a program is a scam.
Many home-based business ‘opportunities’ openly violate those standards and are easy to spot:
1) substandard products that are unsaleable apart from the biz opp
2) scammy qualifiers that prevent you from getting paid even if you do somehow find someone to buy what you are selling
3) the company ‘hides’ the product until you cough up cash to find out what it is they want you to sell
Bi-Centennial Surprise
I joined my first biz opp around 1976. I was 12 or 13 years old. From then until I “wised up” in the 80′s I had joined hundreds of programs purchased through direct mail offers, income opportunity mags, and joined half a dozen MLM programs promoted by friends, family, and in some cases complete strangers.
I wasted money on envelope stuffing schemes, ‘blind ads’ for business opportunities that were nothing more than vague marketing plans for hypothetical ‘business start up plans’ that required coming up with 5-10 times the average national income in America at the time just to test and see if the idea would work or not. Of course, you couldn’t get a refund without trying the unreasonable and unproven ideas, yeah, I got ripped off on those purchases.
I tried forced matrix systems with junk info products and health products. While just a teen I gave up credit card numbers ‘just for verification purposes’ only to end up with $800 of worthless vitamins shipped to my door. I had fallen victim to online and offline chain letter schemes. And the list goes on an on.
Red Badge Of Experience
Fortunately it only took a few short teen years of bumping my head to finally come up with my list of ‘red flag’ identifiers for recognizing potential scams, and a few more to finally trust in the red flags.
Times are hard. The economy is in a slump. Gas prices are on the rise and so are home foreclosures. Con artists are desperate too.
People from all over are desperate for something that will put money in their pockets quickly. That desperation has put a target on their foreheads for scam artists and hucksters of all sorts. Others are not so desperate but are still looking for ways to increase their income without much hassle or work.
I Bet You Think This Note Is About You…
If either of those scenarios apply to you I suggest taking a close look at any program you are considering.
Verify the program has 3rd-party tracking in place to insure you will get paid. Better yet, look for programs that allow you to keep every penny you earn from reselling or referring the products to others.
What qualifies? Reseller programs and programs that allow you to keep all the money are the next best things to creating your own products — but without the hassles.
Also make sure the company is promoting real products that are being sold or have been sold without the need for an attached ‘opportunity’. Again, if products cannot be sold at the price you are urged to ‘get in’ at while things are “still hot”, you’ve found a scam not a real business.
And especially make sure there are no weird or outrageous qualifiers to finally receive the commissions you’ve earned.
That’s how to tell if a home-based business is a scam.
Andre Bell is a business growth strategist and expert direct response copywriter. Visit his site to learn of his recently released .
Are you tired of the pea-brains and jerks that you have to deal with at that lousy job every day? Are you making enough money to make it worth your while to stay there and suffer? If not, then get the heck out of there! Start YOUR OWN Business!
So many people around the world have their own home based businesses and you can finally do it too, if you want to! I am not talking about some silly, crackpot scheme where you buy seven thousand dollars worth of vitamins that end up in your garage next month!
Here are a few awesome home business ideas:
#1: For starters, you can visit my fabulous website where I sell many things both retail and wholesale! I am happy to sell items in small quantities, at wholesale prices, to individuals who might not even have a business, and all the annoying paperwork (business licenses, tax ID #s, et cetera), BUT they would like to simply re-sell these items to people in their neighborhood! When you see something that you would like, please send an e-mail to find out the price for the number of pieces that you want!
#2: On the website, we have a few wholesale package deals already listed, such as these
These fantastic and popular Self-Defense Pepper Sprays are legal in all of the United States, but there are a few states that have very specific laws as to where and how you can purchase one! If you live in the continental USA, but NOT in MA, MI, NY, and WI, and you are 18 or older, then we can ship these to you! You can peddle them around your town, and tons of people will buy them on impulse, as they are not available in every corner store!
#3: If you don’t care for or don’t want to sell face to face, then simply and then visit a place such as GoDaddy.com to set up a simple website where you can sell the items you choose to sell…Online!
#4: You can easily start a business in your town, offering a service, such as auto washing, waxing, and detailing, baby-sitting, dog walking, typing term papers for students, running errands for busy people, and so much more! When you start doing a great job for people, you will get referrals and some word-of-mouth advertising! I also have an eBook with Over 111 Great Ideas How You Can Make Money From Home Without Being A Slave To A Job! You can order it on my website for less than the cost of an over priced Cappuccino and Pastry at a Silly Coffee Chain Store!
#5: Most of the awesome merchandise on our website is listed in some great, top-quality, full-color catalogs featuring lots of great items that YOU can sell by simply showing these catalogs to other people in your neighborhood or community and taking orders (with payments) from those people! People LOVE to buy from catalogs and they have done so for over a hundred years! You can cash in with capturing some of that business for yourself! Earn a 25% commission as soon as you get one or more of these catalogs in your hands!
#6: If You can write, then you can begin your own business writing article marketing pieces for people who have their own websites! That is how I, Father Time, got started on the Internet! I had been a published writer for 32 years without even using a computer or the help of the Internet, but then I began writing article marketing pieces as a ghost writer for other people who had their own websites that they needed to promote!
You might be surprised, but there are tons of people out there who have a website, but they may not have the time or the ability to write some content, articles, and so forth to promote it, and they will happily pay you, if you can write for them! They can PayPal the funds to you and you can e-mail them the articles which they will post on an article marketing website such as ArticlesBase.com which is my favorite of them all!
#7: You can also develop your own Home Party Plan Business of Selling Merchandise Using Those Catalogs listed above! Or you can sign-up to be a DEALER of products from Tupperware, Avon, or Fuller Brush…these are three FABULOUS companies! You have to work, though, you cannot just buy the starter kit and then do nothing!
There are seven great ideas to get you started thinking about freeing yourself from the bondage and slavery of that job, and there are over a hundred more in my awesome eBook which you can actually order right now, and it will be e-mailed to you as a Microsoft Word attachment. Then you can get started earning money within a few days or maybe even a few hours, depending on what you choose to do!
Please don’t let a negative person in your life tell you that you cannot do this!
I AM TELLING YOU THAT CAN DO WHATEVER YOU CHOOSE TO DO!
“The person who says it cannot be done should not interrupt the person who is doing it.”
Good Luck and Many Blessings to You!
Father Time has been a published writer for over thirty two years and particularly focuses on motivational and self-help writing and speaking! He also has many years of sales experience and writes sales & marketing training and materials. He has a fabulous new eBook out that features over 111 Ideas How YOU Can Make Money From Home With Your Very Own Home Based Business!
Father Time currently does a lot of writing for hire, especially article marketing pieces for folks who have their own websites to promote. IF you have a website, you should contact him for some good writing to promote your site; right away! You will be glad that you did!
Father Time also deals in wholesale merchandise of a wide variety, and is especially interested in helping ordinary people who need to earn extra cash, by allowing them to buy a small quantity of wholesale items for the purposes of reselling these items for a cash profit. This is a very simple way to earn an immediate cash income! It would be just like the folks who sell those well-known vitamins, cleaning supplies, or cosmetics, but you won’t be selling something that a million others are selling!
His website is: If YOU are simply purchasing merchandise at retail, YOU can save an extra 15% off. (Sorry, discount does not apply to writing, readings by e-mail, eBooks, or on wholesale packages) The coupon code is: SaveNow
Yes! You can fire your Boss and make yourself your own Boss! Promoting or selling other people’s stuff on the net can make you earn a comfortable living that will give you confidence to quit from your job! You can do that by joining affiliate programs. What is an affiliate program? Affiliate program refers also to associate program, referral program or bounty program. It is the most famous and the best sales and marketing strategy ever used by most of the companies or sellers on the web from small to large-scale companies. This allows “other people or companies” to promote or sell their products or stuff for a commission or other consideration. That “other people or companies” are called “Affiliates” and the owners of the products or services and of the affiliate program are called “Sponsors”. Many affiliates are earning considerable amount of commissions up to more than $10, 000 a month and even hundreds of thousand dollars, through this affiliate scheme depending on your creativity and working habits. Because of this, most of them stopped working as an employee and focus on affiliate marketing at their own time, own pace, own strategy and most importantly, at home with their families without seeing a face of the annoying BOSS! How will you earn and receive commission? As an affiliate, you do not need to maintain stocks or inventory of products or services of your own or of your sponsors. You will be only required to promote their stuff, by putting your sponsors’ banners or text links on your site pages or by posting ads on other sites or by sending emails to your relatives, friends and acquaintances. Your sponsors will give you an affiliate or tracking code or link. When an interested visitors click the banners or text links with your affiliate code or link from your site or promotion page, they will be directed to your sponsor’s website. The affiliate code or link will be the reference of your sponsor to identify that those visitors came through your referral or from your promotional page. Once those visitors completed transactions that are subject to commissions, your sponsor will credit your account for the equivalent commissions from those transactions. Your commissions will be accumulated and be sent to you by check, wire transfer, direct deposit and by other means based on your affiliate agreement. There are different ways to earn a commission from affiliate program. You may earn on the basis of pay-per-click, pay-per-lead, pay per sale or through referring another affiliate. In pay-per-click, the affiliate earns commission when a visitor clicks the sponsor’s link. In pay-per-lead, the affiliate earns commission when a visitor click the sponsor’s links and completed a transaction without buying a product, like completing a inquiry form or survey or quotation form. While on a pay per sale, you will earn a flat rate or a percentage of sales prices. Some of the programs are offering up to 80% commission. How can you join an affiliate? Generally, affiliate programs require the applicants to have a working website where you can promote their products. However, some of them will allow you to promote or sell their products through posting ads with ad sites or by emailing people but absolutely no spamming or you will be kicked out. For this purpose, we have compiled a reliable affiliate or associate programs on web with site description and commission details. Reliable? Yes, because there are websites that are being managed by crocodiles or opportunists who are offering an affiliate programs but will not report all your earned commissions or worst, they will not pay you. So, beware of them. What are the affiliate programs you should join? To start your journey of firing your Boss or quitting your job, you have to start joining affiliate programs, NOW before others do and begin earning THOUSANDS of DOLLARS. I recommend that you start with Google Adsense. This the simplest and most popular affiliate program on the web. This is a pay-per-click affiliate program and the Google ads are related to the content of your site. You may also place Google web and site search button and earn money when your visitor uses it. I advise you to put Google Adsense link prominently in all of your web pages. To start earning cash from Google. After joining Google Adsense, start joining the following affiliate programs: 2-Tier Affiliate Programs: These are programs that allow you to recruit an army of sub-affiliates and receive a commission from their revenues. Lifetime Commission Affiliate Programs: These programs give commissions for life for revenues from the same customer or sub-affiliate. This kind of commission is also known as residual income. Affiliate Networks: These programs have a wide variety of choices of products or services to sell or promote. Each affiliate network offers several affiliate programs from several companies including those world’s famous brands and products. It monitors all your earned commissions from various programs and pays you in only one check on a scheduled payment date. That’s very convenient! Check our site. High-Commission Affiliate Programs: These are the programs that are giving commissions up to more than 80% of the sales. Why waste your time promoting products that will pay you a penny only. With hardwork, patience and continuous learning, I am confident that you will be one of famous affiliate or internet marketers in the near future. You will be working at home with your family at your own time, at your own pace and with your own strategies. That will be the time that you’ve fired your BOSS and made yourself your own BOSS!
Yes! You can fire your Boss and make yourself your own Boss!
Promoting or selling other people’s stuff on the net can make you earn a comfortable living that will give you confidence to quit from your job! You can do that by joining affiliate programs.
What is an affiliate program?
Affiliate program refers also to associate program, referral program or bounty program. It is the most famous and the best sales and marketing strategy ever used by most of the companies or sellers on the web from small to large-scale companies. This allows “other people or companies” to promote or sell their products or stuff for a commission or other consideration. That “other people or companies” are called “Affiliates” and the owners of the products or services and of the affiliate program are called “Sponsors”.
Many affiliates are earning considerable amount of commissions up to more than $10, 000 a month and even hundreds of thousand dollars, through this affiliate scheme depending on your creativity and working habits. Because of this, most of them stopped working as an employee and focus on affiliate marketing at their own time, own pace, own strategy and most importantly, at home with their families without seeing a face of the annoying BOSS!
How will you earn and receive commission?
As an affiliate, you do not need to maintain stocks or inventory of products or services of your own or of your sponsors. You will be only required to promote their stuff, by putting your sponsors’ banners or text links on your site pages or by posting ads on other sites or by sending emails to your relatives, friends and acquaintances. Your sponsors will give you an affiliate or tracking code or link. When an interested visitors click the banners or text links with your affiliate code or link from your site or promotion page, they will be directed to your sponsor’s website.
The affiliate code or link will be the reference of your sponsor to identify that those visitors came through your referral or from your promotional page. Once those visitors completed transactions that are subject to commissions, your sponsor will credit your account for the equivalent commissions from those transactions. Your commissions will be accumulated and be sent to you by check, wire transfer, direct deposit and by other means based on your affiliate agreement.
There are different ways to earn a commission from affiliate program. You may earn on the basis of pay-per-click, pay-per-lead, pay per sale or through referring another affiliate. In pay-per-click, the affiliate earns commission when a visitor clicks the sponsor’s link. In pay-per-lead, the affiliate earns commission when a visitor click the sponsor’s links and completed a transaction without buying a product, like completing a inquiry form or survey or quotation form. While on a pay per sale, you will earn a flat rate or a percentage of sales prices. Some of the programs are offering up to 80% commission.
How can you join an affiliate?
Generally, affiliate programs require the applicants to have a working website where you can promote their products. However, some of them will allow you to promote or sell their products through posting ads with ad sites or by emailing people but absolutely no spamming or you will be kicked out.
For this purpose, we have compiled a reliable affiliate or associate programs on web with site description and commission details. Reliable? Yes, because there are websites that are being managed by crocodiles or opportunists who are offering an affiliate programs but will not report all your earned commissions or worst, they will not pay you. So, beware of them.
What are the affiliate programs you should join?
To start your journey of firing your Boss or quitting your job, you have to start joining affiliate programs, NOW before others do and begin earning THOUSANDS of DOLLARS.
I recommend that you start with Google Adsense. This the simplest and most popular affiliate program on the web. This is a pay-per-click affiliate program and the Google ads are related to the content of your site. You may also place Google web and site search button and earn money when your visitor uses it. I advise you to put Google Adsense link prominently in all of your web pages. To start earning cash from Google.
After joining Google Adsense, start joining the following affiliate programs:
2-Tier Affiliate Programs:
These are programs that allow you to recruit an army of sub-affiliates and receive a commission from their revenues.
Lifetime Commission Affiliate Programs:
These programs give commissions for life for revenues from the same customer or sub-affiliate. This kind of commission is also known as residual income.
Affiliate Networks:
These programs have a wide variety of choices of products or services to sell or promote. Each affiliate network offers several affiliate programs from several companies including those world’s famous brands and products. It monitors all your earned commissions from various programs and pays you in only one check on a scheduled payment date. That’s very convenient! Check our site.
High-Commission Affiliate Programs:
These are the programs that are giving commissions up to more than 80% of the sales. Why waste your time promoting products that will pay you a penny only.
With hardwork, patience and continuous learning, I am confident that you will be one of famous affiliate or internet marketers in the near future. You will be working at home with your family at your own time, at your own pace and with your own strategies. That will be the time that you’ve fired your BOSS and made yourself your own BOSS!
Want to learn the *real* secret to making Affiliate cash without a product or a website – and using unlimited FREE traffic? Check this out…