Start-ups and Buyouts, Family Business and Franchising Opportunities. January 22, 2004. “Wherever you see a successful business, someone once made a courageous decision.” --Peter F. Drucker. Agenda. Startup and Buyout Opportunities Family Business Opportunities Franchising Opportunities.
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January 22, 2004
Developing a commercial market for a recently invented or newly developed product or service.
Taking advantage of available resources, ideal location, advances in equipment, employees, suppliers, and bankers
Avoiding precedents, policies, procedures, and legal commitments of existing firms
Friends/Relatives a courageous decision.”5%
Prior Work Experience45%
Sources of Startup Ideas
No track record
Higher chance of success
Existing customers/ suppliers
Existing business records
Poor quality of current employees
Poor business image
Purchase price based on inaccurate data
Poor business location
Hidden financial aspects, liabilities
Customers tied to current owner
Child becomes aware of facets of firm and/or industry. Orientation of child by family member is informal.
Child is exposed to business jargon, employees, and the business environment.
Child works as part-time employee. Work becomes more difficult. Includes education and work for other firms.
Entry of Successor
Stage VAdvanced Functional
Potential successor begins work as full-time employee. Includes all nonmanagerial positions.
Potential successor assumes managerial position. Includes all management positions prior to becoming president.
Transfer of Leadership
Stage VIIMature Succession
Successor assumes presidency.
Includes period in which the successor becomes dejure head of company.
Successor becomes defacto head of company.
Source: Adapted from Justin G. Longenecker and John E. Schoen, “Management Succession in the Family Business,” Journal of Small Business Management, Vol. 16 (July 1978), pp. 1–6.
Industry Associations(example: IFA)
Master Licensee/Area Developers
Business/ConsultingFirms (example:Franchise Connections)
Probability of success
Proven line of business and marketing methods
Quicker start-up time
Operational and management support
Reduction of capital requirements
Increase in management motivation
Speed of expansion