Among Motivations for Franchise Ownership, Being Your Own Boss Gains to a Record High
By: Michael Alston for Franchise Insights
December 20, 2023 – Since we last reported on the motivations of aspiring franchise owners in July, war has broken out in the Middle East, mortgage rates topped 8% and stock markets plummeted, among other shocks. But by the time of our November Small Business Sentiment survey, optimism about startups rose to the highest in fifteen months. This is despite persistently higher interest rates and tighter credit, as more entrepreneurs expect loans to play a lesser role in their startups with personal sources continuing to take the lead as reported last week.
As we’ve seen in four years of surveying small business startup sentiment, control over one’s destiny continues to propel entrepreneurs towards owning their own business in America.
Consistent with our large sample of interested franchise buyers over the past four years, “being one’s own boss” remains the primary motivator cited by entrepreneurs researching franchise ownership across the FranchiseVentures network of online franchise lead generation brands.
- “Be my own boss” was the most selected response when asked “Why do you want to own your own business?”, with 89.5% of the respondents in November 2023, topping the record high of 89.1% in Q4 2021.
- The survey allowed for multiple responses, and many entrepreneurs also selected “Income Potential” as an additional reason – it ranks a strong No. 2, with 61.4% of the responses in November 2023.
- “Lifestyle Rewards” is the third most common motivation, dropping to 45.3% of respondents. This driver includes the benefits of working from home, setting flexible hours or running a seasonal business. The pandemic gave individuals a taste of greater work flexibility, and they now seek opportunities with the confidence that remote work can be productive and help to achieve better work-life balance.
- “Side Business to Supplement Income” suggests shared or part-time ownership or a less-risky path to start a new business while retaining other income streams. This ranked fourth among drivers, cited by 44.4% of respondents,
- Finally, “Tired of Climbing the Corporate Ladder” was fifth, cited by 31.9% of the respondents, affirming that many aspiring small-business and franchise owners bring a depth of professional experience to their new ventures. In our November 2023 survey of aspiring business owners, 40.3% were leaving full-time jobs
Many of these individuals already have experience with business ownership. In the same Small Business Sentiment survey, just under 15% of respondents were current business owners.
The fundamental drivers for business ownership have not changed despite the outbreak of two wars, the highest interest rates in 40 years, and the Covid pandemic which was certainly the most significant societal and economic disruption since the Great Depression. The benefits of business ownership, including the control of one’s destiny and the perceived returns from the hard work of building a business are worth the risks, and for many, the pandemic became the impetus for taking the first steps.
This Franchise Insights analysis is drawn from surveys of individuals inquiring about franchises for sale among the brands of FranchiseVentures.
Franchise Ventures is the leading franchise lead-generation platform for potential franchisees to thousands of growing franchise systems in the United States and Canada. Its franchise lead generation brands include Franchise.com, Franchise Solutions, Franchise Gator, Franchise Opportunities, Franchise For Sale, SmallBusinessStartup.com and BusinessBroker.net, and together they provide the largest aggregation of prospective franchise buyers in the U.S.
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Published on Wednesday, December 20th, 2023.