Recession Sparks Parent Involvement in College Grad's Future

Green franchise system offers wealth building and stable career for son.

[USPRwire, Fri Jan 22 2010] As the economy collapsed during the fall of 2008, so did Cameron Gonder’s job with thousands of other college seniors who graduated from the Class of 2008.

His father, Rufus Gonder, a certified public accountant, also watched in dismay as his son was laid off from a large, international company; just one year after graduating from college. As a result, he, like many other parents, was forced to take an active role in his college graduate’s career future, a move to protect his college investment and to keep his son’s independence.

With a degree in entrepreneurship, Cameron’s career goal was to one day own his own business, but first get some experience working for someone else.

With Cameron being laid off and the recession happening, Rufus felt that his son’s career path wasn’t going to happen anytime soon and the job market may be limited for several years. So, he decided to get involved.

“I had a client who was a Cartridge World franchisee and read a recent article in Entrepreneur Magazine about Cartridge World’s success. They both reinforced my inclinations that a franchise system would be a good investment for giving my son a solid foundation in entrepreneurship as well as income and job security,” said Rufus.

“And, when you start one of these franchises, I also realized that the goal for greater success is to be a multi-store owner.”

Just like college, Cameron’s father decided to invest in his son’s future by helping fund a franchise business with Cartridge World.

Cartridge World (www.cartridgeworldusa.com), an ink and toner refilling retailer and franchisor of recycled printer cartridge products, is ranked No. 39 among the 500 fastest-growing franchises listed in the Entrepreneur Magazine’s 2009 Franchise 500 list. With its parent company based in Emeryville, Ca., Cartridge World North America has more than 1,800 franchised locations worldwide in 61 countries, with over 650 independently owned and operated retail stores in the United States.

Benefits of Franchising. One of the main benefits for graduates to launch a franchise is that the lack of experience that would hinder their job chances would be of no consequence to a franchisor, says Bob Jackson, a master franchise developer for Cartridge World in Georgia and Tennessee.

As part of the franchise package, he noted that the majority of franchisors provide complete training and ongoing support to enable people to run the businesses effectively.

“Furthermore, many of the attributes franchisors do look for in franchise owners, such as good communication skills and self-motivation, graduates have learned while attending their university,” said Jackson.

Other advice Jackson offers parents is that they should analyze the franchise system’s annuity revenue potential and on-going cash flow as factors in determining if a franchise system is a good fit for their graduate as well as the parents who would be the investors.

“For example, parents are migrating to Cartridge World’s sustainable and repeatable product offering which maintains cash flow even in a recession,” says Jackson. “And, the graduate keeps building equity for 10 years in a business that can have substantial ‘resale value’ thus paying back the parents.”

Rufus targeted from the onset that it would take his son one year to build the business to a break even point, and he is right on track after being in operation for seven months, opening the business on May 1, 2009.

Franchise Investment Ensures a Career. However, Rufus Gonder says that he didn’t become involved in Cartridge World for the investment, but to ensure a career for his son. “I don’t expect a return out of the business; my involvement is to help my son take positive steps toward building his own company.”

Across the country and in nearly all fields, employers hired 22 percent fewer graduates from the class of 2009 compared with the year prior, according to a survey by the National Association of Colleges and Employers. The NACE’s recent survey reveals that employers expect to hire 7 percent fewer graduates from the college class of 2010 than hired from the class of 2009. The drop is even worse in the Southeast with a –9.9 percent decrease from last year.

Rufus warns parents to justify their reasons for helping their child go into business for themselves, because there are some potential risks.

“As a parent investing in a business for your son, you must work out the pros and cons in your mind, then decide whether to take that step,” says Rufus. “I found franchising to be a safe investment, but if you can’t get comfortable with that, then don’t do it.”

“I am confident that my son can make this business work; he loves the business, it fits him to a tee,” says Rufus. “Cartridge World has provided us with comprehensive training and ongoing support to be successful. Their 20 years of experience in research and development is also reassuring.”

From Cameron’s perspective, franchising has given him an opportunity to do what he has always wanted to do, “be in business for himself.”

“If I kept working for a big company, I was going to leave eventually anyway,” he says. “The current times, along with my father’s involvement, just made it happen quicker. I have no regrets.”

Starting a Business during a Recession Cartridge World has been a good business decision for the Gonders during these bad economic times, they say.

“It was scary to go into business during a recession,” says Cameron, “but my father and I felt good about Cartridge World’s pro-green environment stance and its affordable and reusable technology business model.

Business owners are looking to cut costs in a recession, and our store offers cutting their printer cartridge costs up to 40 percent without sacrificing performance or quality, a strong selling point during a recession that saves a business owner money.”

“Additionally, our business is offering consumers and businesses an eco-friendly option to buying new with a way to protect our environment and to create a pro-active solution to reducing waste,” adds 23-year-old Cameron.

The Franchise Advantage. When someone purchases a franchise or goes into a franchised outlet business, they are in business ‘for’ themselves, but not ‘by’ themselves, notes Jackson, a two-time national award recipient of Cartridge World’s Outstanding U.S. Master Developer of the Year for being the outstanding developer in franchise sales and innovation within the $80 billion printer cartridge industry.

“Franchises offer a much more secure method of entrepreneurship. They are using a proven business model, and therefore, franchisees have a better chance to succeed than if they were to start something from scratch,” he said.

Funding a Franchise. Funding is another factor to consider when looking to purchase a franchise. Across the board, getting loans and funding for anything from a home to a car to a business is harder than it has been for decades. Financing a franchise in a down economy is no exception.

“However, that certainly doesn’t mean you should throw in the towel,” says Jackson. “If you’ve found a franchise opportunity that’s the right fit for you, there are still ways to get the funding you need, like focusing on those franchises that are approved by the SBA (Small Business Administration).”

“For example, Cartridge World has been on the SBA National Registry since 2004 which enables SBA loan applications to be processed rapidly. Additionally, Cartridge World is in the top 20 of the least defaulted SBA loans which shows our franchisors are able to repay their obligations,” notes Jackson.

Jackson also recommends checking out community banks that are now seeking to make home equity loans. “Parents can tap their home equity as another means to help their graduates secure a loan. Otherwise, they have no chance to obtain one.”

Being prepared before you start applying for loans is a sure way to improve your chances to get funding.

“Have a business plan and a finance plan in place, along with your pro forma projections,” says Jackson. “A good franchise system will help you answer these questions. Knowing this information will save you time and increase the likelihood that you will get funding for your franchise investment. Equally important, when lenders see an experienced franchisor behind a novice franchisee, they become more willing to grant the loan.”

But the best advice the franchise guru can give parents is that a locally owned franchise is a great way to keep the graduate close to home, says Jackson. “They won’t be threatened with being transferred out of state, and they are their own boss.”

Whatever the size or type of business being run, being self-employed involves a lot of hard work and long hours. For many new graduates facing a tough job market, becoming a franchise owner could provide the career path they have been looking for.

For more information on franchising, or on the Cartridge World franchise system, contact Bob Jackson, master franchisee, at bjackson@cartridgeworld.com or, (615) 377-6393.

Bob Jackson is one of 25 North American Master Franchisees in its system that awards territories to qualified candidates. During his five-year career with the company, Jackson has awarded over 50 franchise territories in Tennessee and Georgia, with 80 percent of those new franchisees being start-up businesses and the remaining 20 percent as multi-store operators.

GREEN FACTS FOR SIDEBAR

Green Facts about printer cartridges to use as a sidebar to this feature story:

· According to Lyra Research, more than 1 billion laser and inkjet cartridges are shipped worldwide each year, with sales of $50 billion. Unfortunately, over 70 percent of all printer users throw away their empty cartridges.

· It takes a gallon of oil to make a new laser printer cartridge.

· A laser cartridge thrown into a landfill takes up to 450 years to decompose with some components made of industrial grade plastic taking up to 1,000 years to decompose.

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