Many people bitten by the entrepreneurial bug decide to pursue a franchise instead of starting a business from scratch. As with any business venture there are pros and cons to buying a franchise. Deciding whether or not its the right option for you requires a lot of due diligence on your part and possibly a little soul searching.

One easy way to start the process of making the decision if a franchise is right for you is to ask yourself a few questions such as:

1. What type of franchise is it? Is it a “package franchise” that comes complete with a business model laid out by the parent company? Or is it a “product franchise” that exist mainly to distribute the parent company’s goods. Generally, an owner of product franchises have more control over the way they run their business.
2. What’s said in the offering circular?
   The Federal Trade Commission requires that franchisers provide specific information to potential franchisees including information on the company’s business experience, legal history, and its other franchises. Read the document carefully.
3. How many franchises does the company currently operate? A large number of franchises indicates a successful, established business. However, be sure to note if there are any other franchises close to where you are looking to locate yours.
4. How much? The initial capital investment required and the franchise fee will depend largely upon the franchise itself. Ongoing royalties can also vary and are usually calculated either as a percentage or a flat fee.
5. Will you have the needed support? Support services can range from helping you select a location for your business, negotiating a lease, advertising for and interviewing prospective employees, getting business licenses, financing the franchise fee or equipment costs, or providing other services. Ask the franchisor what they are willing to provide and get it in writing.

Recently, I read an newsletter by CPA and tax strategist Dianne Kennedy. She operates a website called Taxloopholes.com and produces an interesting weekly newsletter full of tips.
In this week’s newsletter, she listed what the Top 10 Locations for Audits were — i.e, you’re more likely to get an audit if you live here. She listed:

• Los Angeles
• North Central District (ND, SD, MN)
• Southern California
• Northern California
• Manhattan
• Central California
• Brooklyn
• Southwest (AZ, NV, NM)
• South Florida
• Houston

Kennedy goes on to say that how much you make is also a factor. While most people would think those who get audited make more money, its actually people who make LESS money who are audited more. In fact, the most likely return to be audited is a return that includes a business making less than $25,000 per year. If you have a business, you are much more likely to be audited if you operate through a Sole Proprietorship (Schedule C). In fact, you’re ten times more likely to be audited as a Sole Proprietorship than if you’re run your business through an S Corporation or a C Corporation. Why? Because most Sole Proprietorships don’t have great record-keeping systems and the IRS knows that.

No one likes to give or be on the receiving end of a termination.  It’s human nature to want to avoid conflict whenever possible.  However, as business owners and managers we often must perform the task of terminating an employee.  Not only is this a stressful situation for all involved, but it can  be a potentially litigious one if not handled correctly.

How you handle the situation can have a huge impact on the outcome.  Choosing to remain professional and to treat the employee with dignity and respect — regardless of how you may personally feel — is paramount.  Also try to:

1. Clearly outline the reasons why the employee is being terminated.  If need be, put it in writing to avoid any misunderstanding.
2. Provide the employee with an opportunity to discuss it.  It may not prove to be pleasant dealing with pent up emotions, but it may provide the employee with an opportunity to come to terms and accept responsibility for their actions that led them to this point.
3. Handle all terminating paperwork at the time of dismissal.  If the employee is eligible for COBRA or other company benefit program’s have the paperwork ready to go.  Explain what needs to be done and ask them if they have any questions.
4. Prepare a reference letter.  Every one has some redeeming quality.  If they hadn’t, you would probably never have hired them.  Focus on the positive – always on time, had perfect attendance, etc.  Discuss it with the employee so there won’t be any surprises down the line.
5. Part amicably.  The terminated employee may feel angry or resentful about being terminated, but if treated with professionally with respect and dignity they are likely to deal with the situation better in the long run.  Also remember that most employees leave friends behind when they leave.  Do you want your other employees to become aware of how terminated employees are treated? Morale issues are the last thing you want to address.

Yesterday, AT&T announced the launch of OnwardSmall Biz, a new web portal offering a variety of resources geared to small business owners including free advice, online courses and special offers.

Content features and links on the new AT&T Onward Small Biz portal include:

A daily feed of industry-specific small business news, including streaming video segments from SBTV.com — Small Business Television.

Free instructional Web-based seminars and online training courses hosted by experts.

The ability to submit questions and to receive one-on-one advice from SCORE — Counselors to America’s Small Business.

Tips on starting, managing and relocating a small business.

Money-saving promotional offers from AT&T and other leading brands, including UPS, Pitney Bowes, Lenovo and CareerBuilder.com.

Information about AT&T’s portfolio of products and services for small business.

Family owned businesses are quite common and can have their own unique set of issues to address such as family rivalries, succession and tax planning, marriages and separations, family conflicts, illness, etc.

To avoid potential legal issues that may arise from family-owned businesses consider these tips:

• Structure the business as an entity (Corp., LLC, Partnership). This makes it easier to structure the business should there be times of transition.
• Owners should come together regularly to discuss goals, vision and planning.
• Create a succession plan to accommodate the goals set as it relates to future ownership and control.
• Develop a formal written policy that addresses the permitting or restricting of family members and spouses roles in the business.
• To reduce future misunderstandings or faltering memories, keep written records like in any business, especially of arrangements among the family.

Insurance and taxes.  According to a Wells Fargo/Gallup Small Business Index survey, they are the two things that small businesses worry about the most going into 2007.  The top five concerns are:

• Cost of Insurance (64%)
• Taxes (62%)
• Energy prices (54%)
• Government regulations (45%)
• Finding qualified employees (42%)

In terms of priorities, small businesses report being focused on generating stronger revenues, cutting operating expenses, reaching more customers, advertising and investing in technology.