Get An MBA Or Buy A Franchise?
Many college undergrads and recent grads are contemplating whether to obtain an MBA. While often viewed as a career accelerator, an MBA does require major commitments of money and time.
Usually, there are four determining factors: cost, time involved, return on investment and job market. But, now there's a fifth consideration: get an MBA or spend the same amount of money to invest in owning a franchise?
To pay for an MBA, most people work part-time at low wages while enrolled, deplete their personal or parents savings, and obtain student loans that must be repaid. However, going the franchise route can provide a fast and lifetime income that often exceeds the income of those with MBAs.
After graduation, with a degree in Business Administration, from the University of Denver in December 2008, 23-year-old Tanner White considered getting his master's degree. He then weighed his options.
“I?d spend the same amount of money pursuing a MBA as I would to become a business owner,” said Tanner. “If I got my master's degree it wouldn't guarantee a job, especially in today's job market. Plus, I most certainly would not be my own boss.”
Tanner purchased a portion of the Denver College Hunks Hauling Junk in June of 2009 from Nathaniel Bruno, who was the sole owner, and is very pleased with his investment. “I don't think that pursuing a MBA is a bad idea” said Tanner, “but for me taking control of my future rather than hoping for opportunities obtained through a master's degree seemed like the best path.”
According to Nick Friedman, co-founder of College HUNKS Hauling Junk, several of his franchise owners are recent college graduates, which is not the typical franchise owner profile. “Rather than spending $95,000 and two years getting an MBA, more and more people are using the money to open a franchise,” said Friedman. “And, in less than two years they own a cash-producing asset.”
Friedman and his business partner, Omar Soliman, brought a clean-cut image to junk removal by recruiting college students to haul away customers? unwanted items. The temporary summer gig started in 2005 has grown into a multi-truck, multi-million-dollar franchise operation with locations across the country.
“Franchising allows people to go into business for themselves but not by themselves,” Friedman said. “It offers a much more secure method of entrepreneurship.” New franchisees get five days of training at “HUNK University” in Tampa to learn every aspect of the business. The company focuses on branding, marketing, community involvement and recycling efforts.
Just like college, parents can invest in their child's future by helping fund the business. Tanners parents helped their son by co-signing the loan for the franchise. “This is a great business,” said Tanner. “It's fun, you do a lot for the community and can make a great deal of money if you follow the franchise formula.”