Business-to-business franchises offer good opportunity for some - Ahwatukee Foothills News: Money

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Business-to-business franchises offer good opportunity for some

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Posted: Wednesday, September 18, 2013 7:45 am

There are more franchises out there besides fast food and retail. Some lesser-known franchise opportunities are turning out to be very profitable for certain types of business people, according to FranNet, a franchise consulting company.

FranNet primarily consults investors on which franchise opportunities might be best suited for them. Kent Craven of FranNet of Arizona said he’s seen a certain type of franchise growing in popularity among his clients.

Business-to-business franchises are not usually located within a strip mall and they don’t usually do much marketing. Their clients are other businesses.

“These opportunities have grown to be more sophisticated in the past few years,” Craven said. “The perception is all franchises are fast food or retail based. Over the last several decades any service or retail industry that hits a billion-dollar mark, there’s either a franchise system in that industry or one coming soon.”

It takes a certain type of person to run a business-to-business franchise, Craven said. The key to success is comfort in the business world.

“About three-fourths of our clients tend to be senior professional white collar executives leaving the corporate world, either on their own or being forced into a career transition,” Craven said. “They have a choice to go back to the corporate world or go out on their own. Those are our clients. They want to thumb their nose at the corporate world and go about making profit for themselves. Those clients are very comfortable in a business-to-business situation. They’ve typically had a long successful career in the business world and they’re comfortable leaving the corporate world and joining a business-to-business franchise and turning right back around and selling their extra services back into the corporate world.”

Business-to-business franchise opportunities can often be started with less up-front investment than well-known franchises, and many professionals going into this type of franchise have been able to replace even a six-figure income they may have had in the corporate world, Craven said.

Though there are a lot of opportunities in business-to-business franchises it does take the right fit, said Ken Cost of Ahwatukee Foothills. Cost purchased an Expense Reduction Analysts (ERA) franchise in 2007. His company helps businesses reduce what they are spending on overhead.

At the time Cost was retired from medical device sales and distributing, and was looking for something to keep himself busy in a different field. He worked with a broker to identify opportunities before coming across ERA.

“I wasn’t really interested in the typical brick and mortar type of thing,” Cost said. “One of the brokers brought this opportunity to me and I thought it would give me an opportunity to use what I’ve done in the past in business from running a distributorship and putting together sales teams. That’s when I went to work doing this.”

Cost warns that success is only what you make of it. His business has only been successful as he has worked hard at it. It’s not an opportunity for anyone.

“You need a deep burning desire to succeed and almost a fear of failure,” Cost said.

There are several different business-to-business franchises available out there. Brokers like FranNet are key in finding the right one, Cost said.

• Contact writer: (480) 898-7914 or

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