Is Semi-Absentee Ownership Really Feasible?

Semi-absentee ownership is the new latest and greatest #trending buzzword in franchising. The dream of owning your own business while not working in the business is something that every entrepreneur aspires towards. Now if you’re building a business from scratch, this is obviously not possible but that’s where franchising comes in to bridge the gap!

What is semi-absentee business ownership? According to ChatGPT: Semi-absentee business ownership typically involves owning a business and having limited involvement in its day-to-day operations while still retaining some level of decision-making authority.

With defined processes, software to automate certain parts of the business’ workflow and franchisor support (and much more), this is, of course, much more feasible. Does that mean you can sail off into the sunset while sipping margaritas and the money will come flowing in? Well, that depends…

It depends on the industry, type of business and the owners’ goals. Historically, franchising used to be synonymous with gyms and restaurants which, in my opinion, are quite conducive to be run “semi-absentee”, especially a gym where members don’t need significant interaction once signed up. Although you can normally feel the passion when a gym or restaurant is run by the owner, it may not be a necessity. The ramp up period for these types of businesses is relatively quick, but require a large, up-front capital investment.

Fast forward to today and home service franchises have become the craze! And rightfully so since the investments are relatively small, often less than $200k, with potential for multi-million dollar revenue. Sounds like a no-brainer, right? Not so fast! That same semi-absentee ideal can’t necessarily be copy pasted. These types of businesses require a different type of effort to get off the ground. There is no location that people go to. You must build your brand, assemble and motivate your team, ensure quality control in the field, sell the jobs and so on. With a longer ramp up period, it takes some time before you can just hand over the reigns to employees. You can see how the challenges of this type of business are different and not as conducive to “semi-absentee” or “passive” ownership up-front. Someone needs to be driving the business. That can be through the form of a GM or, yourself as the franchise owner, but someone needs to roll up their sleeves, get to work, and get the business off the ground. People aren’t going to walk into your business as they would with a gym or restaurant. The same rules don’t apply. Each come with their pros and cons and it’s important to understand the differences.

Franchisors who claim home service concepts can be fuelled by money alone should make you question if it’s too good to be true. If that’s all that was needed, then why would they need franchisees? They could simply raise capital and get a much higher ROI. Running a local home service franchise requires more than just capital. It’s a local business that requires local presence, drive and passion to succeed. Sure, these can all be handled by a general manager but it’s important that this GM be treated like an owner if you want the business to thrive. Isn’t that the whole point of franchising in the first place, local ownership and resulting passion?

These promises can be misleading and result in false expectations that set a poor foundation for a strong business relationship between franchisee and franchisor. With the wrong expectations in mind, it does not set anyone up for success. Time, work, and patience are what it takes to achieve a “semi-absentee” status. The pre-marketing, launch and continual monitoring of KPI’s in their business will lay that foundation. The franchise owner really needs to be immersed in marketing in the immediate area & community, assembling a top-notch team, establishing goals and holding the team accountable to them!

So What Does Semi-Absentee Mean For Spray-Net?

We are working on making the business as easy to run as possible through better processes, simpler chemistry, automations using our proprietary software and the best equipment. But just like a Tesla, someone needs to be behind the wheel. Who will that be? It doesn’t have to be you but if it isn’t, does that person have the same vested interest? He / she needs to if you want your business to grow and be less hands-on. Motivations need to be aligned and everyone rowing in the same direction. Incentives such as stock in the company for hitting certain targets for the GM, and maybe the team, can reduce turnover and increase engagement. The ultimate goal is to become “semi-absentee” but it is a status that is achieved only after many hours of work on the front end and oversight during the initial weeks / months to make it possible.

As an entrepreneur my purpose is to solve problems! Make the impossible possible, and I hate to say this because it’s cliché, but if it sounds too good to be true it probably is. The American dream was built off those that rolled up their sleeves and got a little dirty, led by example and assembled a world class team to deliver an in-demand product. We have the concept, we have the processes and the support, we need franchise owners who will drive the business locally.

Now don’t get me wrong, our goal is to get franchisees to work on their business asap and don’t expect any of them to be painting homes but it’s not a bad idea to really learn all aspects of the business. Often it makes sense to work in the business for a little bit before working on the business to set a solid foundation. Crawl, walk and then run to build your empire. Not the other way around. That’s my 2 cents and I’m sticking to it!