Sole Proprietorships Being Your Own Boss. Sole Proprietorships “A one-owner business.” Most common form of business in the U.S. (76%) Pros: Easy to organize.

Sole Proprietorships

Being Your Own Boss

Sole Proprietorships “A one-owner

business.” Most common form

of business in the U.S. (76%)

Pros: Easy to organize Quick decisions can

be made All profit goes to one

person Pride in the business

Sole Proprietorships (Cont’d)

Cons: Limited resources to

start and operate Unlimited liability:

Responsible for all debts of a business

Limited life: Business ceases to exist when the owner dies

High failure rate: 70% fail within 5 years

Franchises “A business

arrangement which allows a business to operate under the name of an established brand, like McDonald's.”

Most are sole proprietorships, but can take other forms

Franchises (Cont’d) Pros:

Valuable brand and proven operating system

Safety and dependability

Ability to purchase a pre-existing unit (no starting from scratch)

Support service

Cons: Difficult approval

process Less control –

many rules of operation

Expensive for individuals to start

Sample Sole Proprietorship #1

Franchise fee - $42,000 Total investment - $438,000 (build,

equip, and stock your store) Average store earnings - $381,000 High operating cost: absentee ownership

not allowed; 15 employees per unit required

Expensive product - $4/scoop

Sample Sole Proprietorship #2

Franchise fee - $15,000 Total investment - $310,000 Average store earnings - $80,000 High operating cost: absentee ownership

not allowed; 6 - 10 employees per unit required

Cash liquidity requirement - Minimum $80K

20-year term operating contract

Top 10 Franchises for 20121. Hampton Hotels ($3.7M - $13.52M) 2. Subway ($85K - $260K)3. 7-Eleven Inc. ($30K - $1.64M)4. Servpro ($133K - $181K)5. Days Inn ($187K – $7M)6. McDonald’s ($1M - $2.16M)7. Denny’s Inc. ($1.18M - $2.4M)8. H&R Block ($31K - $138K)9. Pizza hut Inc. ($295K - $2.2M)10. Dunkin’ Donuts ($374K - $1.6M)

2008 Franchise of the Year 7-Eleven Inc.

Began as a Dallas-based ice cream store (open 7AM – 11PM)

5,580 stores in the U.S. 25,062 stores abroad A new store opens in

the world every four hours

Extensive support service – training, marketing, & operations

2012 Franchise of the Year The first Hampton Inn opened in Memphis,

Tennessee in 1984. Hampton Inn was the first mid-price national

hotel chain to begin offering a free continental breakfast and free local phone calls.

In 1995, the Hampton brand introduced Hampton Inn & Suites, which consisted of two-room suite hotel rooms with living rooms and kitchen areas.

1907 hotels in the U.S. – plans to expand worldwide.

Now acquired by Hilton Worldwide (which has hotels in 84 countries).