Determining if a Home-Based Franchise is Right for You

How can you tell what is a genuine home-based franchise opportunity, and what is not? Like any business opportunity – franchise or otherwise – it is imperative that you do your due diligence before you invest.

By Andrew Seid, Consultant, MSA Worldwide

The concept of a home-based franchise can seem very appealing, and for good reason. Having the ability to earn a living while maintaining a flexible schedule at the same time is the “dream job” for many people. Additionally, being able to own and run a business in addition to your current day job is a great way to increase your personal income.

However, not every home-based franchise opportunity provides for the same level of balance, and sometimes an uneducated or unprepared franchisee can find that they’ve been sold a bill of goods.

Some franchisors may make claims that their business can be run completely out of your home and/or without taking the time commitment of a traditional 9-to-5 job; but, when reality sinks in, you’re spending more time working on the business than you expected or were promised. How can you tell what is a genuine home-based franchise opportunity, and what is not?

Typical Home-Based Franchise Industries

The number of industries where home-based franchises are popping up continues to grow as entrepreneurs’ imaginations develop solutions that can be solved using the home-based franchise model.

Traditionally, home-based franchising has been used in service industry businesses where work is done on location at the client’s business or residence and the franchisor has no centralized brick and mortar location. These are just a few examples:

  • Cleaning/janitorial services
  • Home decorating/repair services
  • Mobile pet services
  • Computer repair services
  • Kiosk quick-service food concepts (i.e., mall/alternative setting locations with minimal menus and prep)
  • Consulting services
  • Tutoring and other educational services
  • Senior care services

The key is to find something that you have a great interest in, and then find out if that business has a well established home-based franchise system.

Like any business opportunity – franchise or otherwise – it is imperative that you do your due diligence before you invest. Of supreme importance is to talk with existing and past franchisees. While a franchisor may tell you that the concept can easily be run from your home office, those past and current franchisees will be able to tell you the real story. Often times the transition to running the business can require more time at the office in the early stages – even for a number of years – before being able to truly take a more “hands-off” role. The current and past franchisees will be in the best position to give you guidance on that transition. Also contact the Better Business Bureau and do a search online for any potential red flags.

Characteristics of a Successful Home-Based Franchisee

Running a business from home is not for everyone. The idea of a flexible schedule and getting work done in your pajamas can be extremely appealing, but running a home-based business brings with it a number of unexpected challenges. Anyone interested in pursuing this type of opportunity can save themselves a lot a time, money, and aggravation by doing a thorough self-evaluation before entering into such a business.

Self-motivation is critical. It’s relatively easy to get motivated when your boss or coworker (or even a subordinate!) is poking their head into your office every few hours to see what you are working on, but what happens when the only one poking their head in is your dog asking to go for a walk? It’s also easy to get distracted by all the daily tasks and projects that linger throughout every home, some of which can seem more appealing than what is on your current work agenda. The discipline to separate work from daily “home life” while still inside your home is a very difficult skill to master.

Organization can also become an issue. Many “home offices” start out as simply the kitchen table, or at best a desk in the corner of a bedroom. Office spaces are hard to keep organized in an actual office, so when those spaces are doubling as home décor in the evenings, organization can fall by the wayside fast. It is critical to assign a specific space – whether it be a desk, a corner of a room, or an entire room if available – that is only for work-related activities, and to keep that space as organized as possible.

​On the flip side, it is important to remember that even though you work at home, you are not ALWAYS at work. Set specific “working hours” and try your best to stick to them. Obviously one of the major benefits of working from home is the flexibility to work whenever you need to, but the danger is never truly feeling like you ever leave work.

Benefits of Running a Home-Based Franchise

  • Flexibility – You can be your own boss and have a decent amount of flexibility with your time.
  • Cost-effective – Having no overhead, as from a traditional brick and mortar office, can be a huge money saver.
  • Start out part-time – For many franchise concepts, you can start as a part-time business while still working your traditional 9-5 job until your franchised business begins to establish and take off into a full-time operation.
  • Personal touch – For home-based businesses where you personally are offering services (home décor, consulting, etc.) there is an extra element of your own personal brand going into the service that doesn’t often shine through when a customer comes into a more traditional brick and mortar location.

Challenges of Running a Home Based Franchise 

  • Work/Life balance – It is increasingly difficult – but imperative – to keep your home life and work life separate.
  • Wearing many different hats – In home-based franchise concepts, you will be the owner and the employee, wearing many different hats in running the daily operations of the business. It can sometimes be difficult to determine when you should be servicing your clients as “the employee” and when you should be keeping the books and servicing the business as “the owner.”
  • Many hours – While you can be more flexible with your work schedule, you will often times find yourself spending more hours working on your home-based business than you would in a traditional 9-to-5 job. With great flexibility comes great responsibility.

Investing in a home-based franchise opportunity can be very rewarding and can be a perfect fit for some people, but it must be in the right situation. Take the time to really do the research and find out what specific opportunity is the right fit for you.