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Franchise Expo gives chances to buy jobs

October 3, 2009 12:39:09 AM PDT
From Car Washes to tutoring to taco trucks, the exhibits at the West Coast Franchise Expo run the gamut of the American business world.At a time when unemployment is soaring, franchise sellers are finding more and more people who want to buy their next job.

"From the research I've done, about 10 percent of franchises fail, as opposed to if you're on your own, it's probably close to around 70 or 80 percent that I don't make it through the first five years, so the odds are a little bit better buying yourself a job through a franchise," says David Dreyer, an expo attendee.

But even though there may be more interest in buying franchises, the one thing that's missing these days is money. Expo organizers will tell you that financing has dried up.

"The biggest hurdle right now is financing, and lenders aren't lending, people are using their 401K money," says Tom Portesy, a Frachise Expo producer.

"A lot of what you'll see is people's equity in homes being used as collateral for a loan, and that's going away a little bit as well," Portesy adds.

But Portesy will tell you that in many cases, a lot of money isn't needed to buy a franchise.

Although well-known names like Baja Fresh and Arby's may require hundreds of thousands or sometimes millions, there are other companies that sell franchises for just a fraction of that.

"You can put $2,000 down and become a franchisee with Jani-King," says Philip Morgan, who represents Jani-King, a 40-year old cleaning company.

Franchises at Plan Ahead, an event planning company, start at $5000, and the same goes for fast food giant Chic-Fil-A.

Of course, the business world is littered with franchises that have failed, but with jobs so scarce these days, more people are looking to own their next career and hoping it will take off.


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