Veterans in Franchising Make a Difference
Entrepreneurial vets have an identifiable impact on the American economy, according to the U.S. Small Business Administration: for every ten vets, one is likely to have their own business; vet-owned business employ 5.8M people; and vets are 45% more likely to start their own business than non-vets. Why are vets so entrepreneurial? Perhaps, because vets (members transitioning back into civilian life, National Guard, Reserve members, and spouses) also have a robust access to resources, such as the Veterans Business Outreach Center (VBOC), if they want to start, launch, or grow their own business—including those who want to buy and own a franchise.
If you are a vet, the VBOC will help you in building your business, so you won’t have to navigate new and uncharted waters unguided, which often is the case for many other entrepreneurs. The VBOC provides business development services like strategic planning, concept benchmarking, structure analysis, and mentorship. These resources are open to veterans who want to buy and own a franchise as well—giving them an even higher probability of success than civilian franchisees. A franchised business basically gives you a blueprint on how to successfully run the business, but this isn’t necessarily an easy recipe for success. If franchisor support is weak, an inexperienced franchisee will have a difficult time thriving. Here, the VBOC becomes a valuable resource. If franchisor support is strong, then the VBOC only reinforces the support structure. So how does all this translate into the real world? Well, veterans substantially outperform non-vets.
Their success rate is reflected in the Military Time’s 2018 Best Franchises, where vet- owned franchises regularly outperform civilian franchises. Their 3-year continuity rate consistently hits close to or at 100% across almost all industries and the difference from non- vet franchises can be +3% to +25%, too! The 2007 U.S. Census Bureau’s Survey on Business Owners (SBO) lists finance and insurance; transportation and warehousing; mining, quarrying, oil, and gas; construction; professional, scientific, and technical services; manufacturing; wholesale trade; agriculture, forestry, and fishing; utilities; and real estate to be the top 10 industries owned by vets.
The high continuity rate indicates a strong support system provided by the franchisor and other franchisees. Furthermore, their 3-year growth rate for vet-owned franchisees regularly exceeds non-vet franchises by over 100%! In addition to resources such as the VBOC, veterans set themselves apart from the non-vet franchisees in their specialized and heavily regimented military experience. The ability of Veterans to demonstrate and exemplify leadership, teamwork, and accordance to a set of procedures rigorously reinforced through their military experience translates incredibly well towards the operations and management of a franchise—the success of a franchise is the success of a mission. Similarly, planning and preparation is essential to a mission. In the realm of franchise ownership, this means veterans still need to do their due diligence if they want a good return on their investment in a franchise. They will need to consider their goals, what type of franchise they would like to own, in what industry, if they have the appropriate ability and experience, and if there is local demand around the area they plan to open at.
Another amazing resource is the VetFran program by the International Franchise Association (IFA) and it’s education and research non-profit, the IFA Foundation. They provide incentives for franchisors to offer veterans special types of financing, reduced royalty fees, and lower franchise fees. For example, The Dream Vacations has a military discount of 20% of the franchise fee; Midas is $30,000; Grout Doctor 50%! These resources—again—add to the probability of success for veteran franchisees. Veterans make up about 7% of the general American population, but they are twice as much (14%) of American franchises.
For more information on how to franchise a veteran owned business, contact Levi Tran with Franchise Marketing Systems: