The Business Life Cycle: A Guide for Franchise Owners

Step 1: Business Idea

You’ve got a great idea and a passion. You’ve talked with friends and relatives and penciled it out. You’ve even picked the franchise you want to own. With all this in place, you’re ready to take the plunge and sign a franchise agreement. That requires a lot of paperwork…and maybe a Small Business Loan.  If you do need an SBA loan, the lender will probably require you to purchase business owner’s life insurance to protect their investment—you. Lewer can help you find the right coverage so you can begin to realize your vision of business ownership.

Step 2: Construction

The franchise agreement is signed and in your rearview mirror. Now you need to build your franchise business and make sure everything is in order, including the insurance coverage requirements included in your franchise agreement. This varies from franchise to franchise, but all agreements require that you carry minimum standard coverages on items such as general liability, property liability, worker’s compensation, business interruption, franchisor errors & omissions liability, also known as E&O, and possibly cybersecurity. You will want to look at a business owner policy (BOP), which combines protection for three types of coverage: property, general liability, and business interruption into one package, which usually saves you money.

As you’re putting your franchise together, you also should consider disability insurance. No one anticipates a catastrophic illness or accident, but it could happen. If you cannot work, disability insurance can replace your income, or you could use the funds to hire someone to assist you in getting the business going in your absence.  Disability insurance usually comes in two forms; short-term (less than 13 weeks) and long-term (longer than 13 weeks).

Step 3: Open for Business

Your franchise business has opened and is starting to rock and roll. You’re doing business, generating income, and hiring employees. It’s time to think more about recruiting and retaining employees. We’re talking about designing a basic benefits plan and a retirement plan for you and your employees. It can be daunting searching the web for information. You don’t need to worry. Lewer provides concierge consulting services that make it easy for you to build a benefits plan that fits your company, your values, and your budget.

Step 4: Expansion

We’re happy to hear your business is doing well. Now you’re considering expanding! More people, more buildings, more money, more… insurance and regulations. If you’ve hired 50 or more people, you may need to start worrying about complying with the Affordable Care Act. You might also be interested in moving from basic employee benefits to more comprehensive group employee benefits. Group benefits can be a step that pays big dividends, including attracting and retaining your top talent.

Step 5: Maturity

Congratulations! Your business is thriving. This notion that started as a passionate idea has blossomed into a successful, profitable enterprise. You are now the proud owner of three challenges everyone would love to have.

First, you have assets, and that means you probably would like some advice on how to best leverage them to fund other business and life goals.

Second, and speaking of the future, now that you are a successful business owner, it’s time to engage in some estate planning. Through estate planning, you can guarantee that your wishes are followed no matter what happens to you, whether that’s taking care of loved ones or ensuring your healthcare needs are covered for the long term.

Third, you may have the goal and responsibility to create a succession plan. A smooth transition in business leadership will ensure your franchise will continue to provide work for employees and benefits to customers, long after you’ve retired.

Step 6: Succession

If you completed Step 5, you’re all set to move on, and all that remains is to dot the i’s and cross the t’s. We know, you’re still a big ideas person and legalese probably isn’t your thing. We’ll see you through right to the end of your part in the business life cycle, with services including a sales contract review and asset management.

And who knows, you may have enjoyed the process so much, you’re ready to start your next big idea. If so, the solution is easy: See Step 1 and call Lewer.