FRANCHISE
Pros: Instant name recognition—you’re associated with an established company, which may reduce risk. With standardized operations, systems and training, you won’t start from scratch creating your own. Some franchisors offer financing to buy a franchise, as do credit unions and banks. You can pick a franchise that fits your lifestyle—a restaurant that may require more time and energy, or a cleaning franchise or another service if you’re seeking more flexibility.
Cons: Potentially pricey franchise fee. Contracts usually favor franchisors. “The franchisee is generally subject to meeting sales quotas and is required to purchase equipment, supplies and inventory exclusively from the franchisor,” states SBA.gov’s “Buying a Franchise” consumer guide.
E-COMMERCE
Pros: E-commerce sales have been growing faster than offline sales, according to the Small Business Administration. You can work from home and create a website cheaply to get your online business up and running quickly.
Cons: Because it’s easy for anyone to try, expect lots of competitors. You’ll spend countless hours marketing and learning to drive traffic to your site so that your business doesn’t end up on page 10 of a Google search. If you’re selling a product, you’ll have logistical issues such as shipping and storage.
CONSULTING
Pros: Create your own hours as you parlay your marketable expertise into a consultancy, which favors confident risk-takers whose speeches enthrall. Low startup costs.
Cons: While you potentially could garner high earnings, there is no guaranteed income and you’re on your own to do all of the marketing, sales and juggling of day-to-day business chores. It takes dedicated networking and time on the road.
FREELANCING
Pros: Be your own boss. Work flexible hours. Pick the projects you want. Low startup costs. People increasingly choose contract work over full-time work, contends a Harvard Business Review blog post titled “The Rise of the New Contract Worker,” which says contract workers eventually may make up 25 percent of the global workforce.
Cons: No steady paycheck. Expect no health/life/disability insurance or retirement benefits—unless you pay for them yourself with a cash flow that hits peaks and valleys. It can be like looking for a new job every day, so commitment, planning and discipline are essential, advises the Small Business Administration, which suggests keeping a day job before striking out alone as a freelancer.
DIRECT SELLING/NETWORK MARKETING
Pros: Earn supplemental income or potentially make a very good living, depending on the time invested, as you personally sell a wide variety of products and services—everything from nutritional supplements to jewelry to financial products to home electric service. So, self-confidence and people skills help. Low startup costs. Flexible hours. Discounts on products or services sold, plus residual income from a percentage of sales made by independent representatives you recruit.
Cons: No guaranteed income. Rejection goes with the territory in any sales job; self-confidence and optimisim help.
HOME-BASED BUSINESS
Pros: You could parlay a talent or hobby into a home-based business that brings in extra money and maybe grows into a full-time concern—just as Steve Jobs built computers in his parents’ home in Los Altos, Calif., long before anyone heard of Apple Inc. More than half of U.S. businesses are based at home, thanks in part to low overhead costs.
Cons: It’s all up to you—you’re the marketer, service provider or manufacturer, accountant and more, and you’ll face distractions at home as the doorbell rings and the dog barks and the clothes dryer buzzes. If you buy a “work at home” franchise, be careful; some are scams.
Read about why now is the time to start a business on SUCCESS.com.