Here's a quick education on four ways to grow your business name and the restrictions to each. (this is from memory and some might be outdated, we haven't had a franchise or bizop in about 9 years:
Simplest - Offer a school to teach what you know. Requires virtually no paperwork, few restrictions. You cannot require students to use your name. You cannot require them to buy from certain vendors. You can offer to sell equipment, but you cannot make it a requirement. You cannot contract with them for a portion of the profits.
More complicated, sortof expensive: Offer a business opportunity. In most states you have to file to sell bizops. It can get expensive. Last I heard it runs about 40k to register in all states. You can sell equipment to do the job. You cannot force them to buy equipment or goods from any specific vendor. You are limited in the total amount the bizop can sell for. There are no requirements for followup service on the sale.
Expensive: Franchising. The cheapest I've ever heard anyone get started up for was $40k. Usually costs over $200k. You must show complete financial stability and the book have to be opened to the franchisee. Extensive records must be kept. You may charge for initial startup and franchise fees (percentage of sales) You may set prices. You may require that all goods be bought through you. You MUST service the customer with documented support and the money you take in must be accounted for and used as advertised.
Very expensive: Grow your own. Everytime you do a job put money away to travel to the next metro area and get new equipment and clients and grow your own company city by city.
In 1993 we started Owner's Auto Mart. When I met Mike W. we were sitting across from each other bidding on lots of repossessed computers. I was buying them to load medical billing software on them to sell to clinics and he was buying them to sell in the paper and take the cream of the crop for his new business idea. We met at the concession stand and he said "We need to divide these up so we're not bidding against each other and we'll make a killing." So that's what we did.
When I went to his office the next day I found it was a little $100/month room with papers stacked to the ceiling all around. But he had an idea. - to make a "for sale by owner" franchise.
In 1993 we opened the first lot. In the back room I began making sales. Shelly modeled for an ad in car magazines selling a product called "Infopak" which hung outside the window of the car and dispensed sheets of info on the car for sale.
By 1994 we had paid the fees to sell bizops in all states but California, hired three more salesmen and we had sold about 26 bizops. By 1996 the bizops and the main lot were successful enough to start franchising. We paid a fortune to franchise. By the time we were done I think we had 71 franchises opened all over the country. (edit, Shelly reminded me that those were a combination of dealerships, (bizops), franchises and company owned.)
By the end of 1997 we had a disagreement as to where it was going. He wanted to get into consignment sales and warranties and financing and I and the other guys didn't. We felt the attorneys were skewing his decisions to their benefit instead of his and ours. We all left with our portion to open up our own lots.
Eventually Mike did get what he wanted, but all the money spent on lawyers did no good when he got mixed up with someone else with a better lawyer who ended up taking almost everything but the name away from Mike.
Mike passed away three or four years ago. He was one of the best guys I ever met and my meeting him at that auction was one of the best things that ever happened to me. He is the person who took me from fear to freedom in the business world.
Here are a couple of pics the photographer gave us that were used in the magazine ads. It's hard to believe that was over twelve years ago.
