Test Yourself
By Geoffrey Stebbins

Assignment: Determine if: a) You are suited to own your own business and b) Which is the best business for you.

Supplemental Facts: The U.S. Department of Commerce states that up to 85% of all independent businesses will fail in the first 5 years of operation whereas over 85% of all franchises succeed. You recognize that logically, the business you own should be a franchise.

1) What type of personality describes you best?

a) decision maker b) independent thinker

c) highly motivated d) lacking self-confidence

2) How well do you make decisions?

a) very well

b) I like other people's input but I stand behind my decisions

c) I prefer others to make important business decisions

3) How much money do you have to invest?

a) 0-$10K

b) $10K-$25K

c)$25K-$45K

d)$45K and above

4) How long can I support myself before I would need to take money out of the business?

a) less then 3 months

b) 3-6 months

c) 6-9 months

d) more than 9 months

5) How many hours are you prepared to invest into the business?

a) 0 hours

b) 10 hours/week

c) 40 hours/week

d) 60+ hours/week

6) You have $50K in a 401K, $40K in stocks, $100K equity in your house and your wife is currently employed. To raise capital for your investment should you:

a) cash out your 401K

b) ask for loan from parents or friends

c) use your stocks

d) take out a home equity loan

7) If you are good at sales and marketing, but poor at door to door prospecting, which franchise would be best suited to you?

a) American Sign Shops - computer generated vinyl signs

b) Blimpee - sub-sandwiches

c) Pennysavers - direct sales advertising magazine

d) Kitchen Solvers - cabinet refacing

8) If you tended to be more introverted, what type of franchiseshould you be looking at?

a) Interface - financial services

b) Treasure Cache - crafts store

c) Shoe Fixers - shoe repair

d) Parson Bishops - accounts receivable collections

9) If you have hands-on management skills, what type of franchise is best suited to you?

a) Candyland - retail mall candy store

b) Auto One - automotive aftermarket

c) Sir Speedy - fast printing

d) Wash on Wheels - commercial powerwashing

10) If you have an entrepreneural business personality, which type of opportunity makes the most sense for you?

a) Burger King - fast food hamburgers

b) New York Fries - fast food french fries

c) Natgo - natural gas filling stations

d) Com-Cep - multi-media computer training

ANSWERS AND ANALYSIS:

#1-5 relate to whether you are qualified to get into business for yourself. If you answered D for #1 or C for #2, you may not be qualified for self-employment or you may need to choose a franchise that operates in a highly controlled environment.

If you answered A for #3, #4 or #5, your ability to get into business will be severely hampered. You need to have a minimum amount of capital available for the initial investment and have at least three months of living expenses. Also, whenever you open a business, you need to exercise initial control to be sure the business is running properly and smoothly and this defiantly takes time. If you don't plan to spend any time in the business, you should be looking at an investment, not developing a business.

#6: There is no correct answer. You need to weigh the positive and negative sides of each scenario. Each person has individual needs and individual situations and often a person needs a professional to help determine what is in the person's best interests.

#7: If you answered C, you probably made the wrong choice. You have to be excellent at prospecting to do well in a direct sales and even to hire someone else, you need to show strong leadership in showing employees how to make sales.

#8: If you answered D, you probably made an error. An introverted personality generally fits better in a retail location where his customers come to him, not a situation where he must pound the pavement for leads and customers.

#9: There are levels of right answers here. Some opportunities require more hands on management, some less. You need to evaluate which franchise suits your needs in this regard.

#10: Every answer except A is a relatively new and entrepreneural opportunity. Fast printing has been around for 20 years and generally has reached the saturation point in the marketplace. Printing might be good for a conservative investor who needs to see many years of track history before investing.

CONCLUSION:

Unless you can correctly self-evaluate yourself correctly, you may make a wrong choice as to the franchise most suited to your strengths, needs and goals. Best to seek out competent advice.