How to Start a Franchise Business in Your 50s

But when she prepared to make the leap, Eboda didn’t look for franchise options in banking, accounting, or finance. Instead, she chose to focus on the skill set that she enjoyed using the most — helping the people she worked with develop their careers.

“One area that I truly cared about was growing careers and helping people navigate through the corporate landscape,” she says. “I just saw an opportunity for people that needed someone to help them really think through their careers and help them navigate. Starting my own business — coaching or staffing — was going to be a platform where I can truly bring that to fruition.”

Start by taking a full inventory of the types of work you enjoy in addition to your family’s financial needs and your personal interests. Then, narrow down your franchise options by removing those that don’t fit.

“For example, do you want employees? Do you not want employees? Do you want to work from home or an office? Retail setting or warehouse setting? Do you want your customers to be blue collar, white collar?” Bailey says. “Think of a big funnel, and as you're going through these questions the concepts that you may have thought were good for you have been narrowed down, so when you get to the bottom you have three to five [franchise options] that have most of the characteristics you're looking for.”

2. Research your options

Two of the best places to start exploring franchise opportunities are the Federal Trade Commission’s “A Consumer’s Guide to Buying a Franchise” and the Small Business Administration’s SBA Franchise Directory. The FTC guide offers a clear overview of the steps entrepreneurs can expect to follow as they select and purchase a franchise, while the SBA directory identifies the franchise businesses that small business owners may get government loans to help purchase.

The number of franchise opportunities available can be overwhelming to entrepreneurs who don’t have their heart set on a particular brand. One option to help with the selection process is using a franchise broker or consultant. These professionals can guide entrepreneurs through the process of narrowing down their options.

Bailey says FranNet’s average client is 55 years old and takes roughly three to four months to complete the process of selecting a franchise before they start the purchasing process. In addition to sorting through the franchisee’s skill sets and preferences, FranNet also requires its clients to review the franchise disclosure documents (FDD) each franchisor is required to submit to the FTC. These forms provide a wealth of information about the brand’s financial picture.

“In a franchise disclosure document, you can see the [franchisee] failure rate,” Bailey says. The FDDs “give a listing of how many are coming in each year, and how many left, so you can measure one franchise against the other and get a feel for the overall risk that you're taking.”

FDDs can be obtained directly from the franchise company or through some state business agencies. These forms are particularly worth seeking out because they also contain contact information for franchisees, so potential buyers can speak directly with current franchise owners.

“We tell them to make calls until they've talked to enough people to get a full picture,” Bailey says. “They should talk to some [franchisees] that are just superstars, some that are kind of the middle of the bell curve and some that are struggling. Find out what makes them different. Is it the location? Is it the skill set they brought to the table? Then ask where you see yourself in comparison.”

FranNet does not charge its franchisee clients for helping them navigate the selection process. Instead, it receives a broker fee from the franchise seller, similar to how some real estate agents get commissions. But other franchise brokers do charge aspiring franchisees, and that can be another significant cost in getting started.

“You have to be sure a lot of due diligence is done,” Bailey says. “It's not something you jump into, no matter how you're going to fund it or where the money is coming from. Take your time. Know your options. And be sure that you're comfortable with the possibilities, upside and downside.”

3. Remember your retirement plan

People age 50 and older also should be sure to consider how owning a franchise business fits into their retirement goals, both financially and personally.

“Franchising could be a great way for people to supplement their retirement income,” Stites says.

Of course, that’s only if the business is successful and the owner did not expend too much of their savings to get started. The choice of whether to dip into your retirement savings — and, if so, how much to take out — is a deeply personal decision that shouldn’t be made lightly.

Eboda, who had knowledge from her first career as a banker, felt comfortable using some of her retirement savings to purchase her PrideStaff franchise.

“People come to this decision based on where they are. I was absolutely from the get-go confident that I was going to be successful in running my business,” she says.

Not all would-be entrepreneurs have the same comfort level. When she made the decision to purchase two McDonald’s restaurants in Texas, 54-year-old Tanyel Harrison Bennett was adamant that she would not use any of her retirement funds to get her business started.

“Everybody has to consider their own comfort level, and what they're willing to do,” Bennet says. “When I looked at it, I said in my 50s, I'm closer to retirement than I am when I started off 30-plus years ago. I can't make up for 30 years in the next 20. If I don't have to jeopardize my retirement, I don't want to do that.”

But with informed decisions and smart practices, a franchise business can offer additional income in retirement along with personal fulfillment that can’t be matched.

“This was like a second career,” Eboda says. “You get to determine where you are going to make your mark and how you are going to be purposeful and make a difference. And, for me, this business was it.”.