IFA, Obama Partner to Employ Veterans

The International Franchise Association (IFA) is working with the Obama administration and the U.S. Chamber of Commerce to make it easier for veterans to take advantage of franchise …

The International Franchise Association (IFA) is working with the Obama administration and the U.S. Chamber of Commerce to make it easier for veterans to take advantage of franchise employment and ownership opportunities. Veteran unemployment sits at 12% (22% for veterans under 25 years old) and Obama is taking steps to provide businesses with tax incentives to hire veterans, as well as discounting franchise fees for veterans who want to run their own business. The IFA’s effort is an extension of its “VetFran” program that aids veterans with opportunities in franchises like Blimpie, The UPS Store and FastSigns. For more on this continue reading the following article from TheStreet.

President Barack Obama declared last month that the remaining military troops in Iraq would come home by the end of the year, a relief for thousands of families, but it means that the number of unemployed veterans is about to get bigger.

Like young entrepreneurs, military vets are a sector in the job pool that has staggeringly high unemployment rates. The post-9/11 veteran unemployment rate is at 12%, according to the International Franchise Association. (Veterans under 25 have it even worse; unemployment rates hover near 22%).

It is this alarming number that has Obama urging the private sector to extend jobs to vets. Along with other measures (for instance, the Senate approved legislation Thursday to incentivize businesses to hire veterans and "wounded warriors" by offering tax credits), one area where veterans can feel confident they’ll find jobs is in the franchise community.

The International Franchise Association, in conjunction with the White House and U.S. Chamber of Commerce, launched an initiative Thursday to recruit 75,000 veterans and 5,000 wounded warriors by 2014 into the franchise industry. The initiative, Operation Enduring Opportunity, kicked off by first lady Michelle Obama in Washington and by franchises in 10 other U.S. cities, is part of the White House Joining Forces Initiative.

The initiative is to provide jobs either owning or working at a franchise, and becoming a franchisee seems a natural fit for veterans. They already own more than 66,000 franchised establishments providing jobs for 815,000 workers, according to the U.S. Census.

"With its rapid training opportunities, defined structure and systems and need for operational excellence, franchising provides an ideal structure to enable returning veterans to become leaders of and productive participants in the U.S. economy," IFA President and CEO Steve Caldeira says.

The initiative expands on the IFA’s long-term VetFran program, in which more than 400 franchised companies provide special incentives, mainly in discounting the franchise fee, to veterans to own their own business.

Here are a few of the companies that provide incentives for veterans to open up a franchise:

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1. Blimpie
Sandwich shop franchise Blimpie launched an initiative this year in honor of its 47th anniversary. Under its Blueprint 47, the sub shop’s franchise fee for veterans and existing franchisees dropped to just $47 (from $18,000) to encourage store expansion.

Jillian Henry, director of franchise development at the sub shop’s parent company, Kahala (owner of 14 brands including Cold Stone Creamery and the Ranch1 chicken chain), says while the deal will expire at year-end, the company is continuing with a 50% discount on the franchise fee to military vets in 2012.

"Obviously with what’s going on around the world and what the U.S. military is involved in, we really wanted just show our appreciation for what the vets do for us," Henry says. "What makes a veteran perfect is [that they are] disciplined, hard-working, they can follow directions and they’re good leaders. As a franchising company those are the exact characteristics we are looking for in franchise owners. We provide all the tools and we want someone to … follow those tools."

Besides being able to follow instructions, military veterans also ask a lot of questions, Henry acknowledges.

"A lot of times they want to know specifically what we’re going to do to support them," she says. "The questions they have are unique in a positive way compared to other candidates because they are thinking long term about their business and how to make it successful."

Henry expects to see further strong candidates as troops continue to come home.

"We’re actually really gearing up for that," she says, by working with companies to secure financing and tapping into federal programs available to vets to start their own business.

2. BrightStar Care
BrightStar Care provides what it calls a "full continuum of home care" that includes adult and elder care services, child care and medical staffing services for individuals, families and health care facilities. The home care franchise offers two incentives to veterans, including a 47% discount on the company’s $47,500 franchise fee. (Start-up costs are roughly $100,000, according to VetFran.) They can also get a $2,500 credit toward technology and national advertising fund fees.

3. FastSigns
FastSigns, a sign and graphic company, will cut its franchise fee in half to $34,500 (total start-up costs typically start at $75,000) for veterans. The company says that as part of Thursday’s announced initiative it has committed to hiring 200 veterans within its franchises.

4. The UPS Store
As part of the IFA’s initiative, The UPS Store (UPS) is looking to waive its franchise fee of $29,950 for 10 qualified military veterans who are first-time franchisees wishing to open a location between Jan. 1 and June 30.

Other qualified veterans will be extended a $10,000 discount on the franchise fee as well as a 75% discount to the initial application fee. Start-up costs range from $150,000 to $371,000, according to VetFran.

5. 1-800-GOT-JUNK
The 1-800-GOT-JUNK chain offers veterans a 50% discount off of every second territory they buy. The cost for one territory is $6,000, meaning if they want to expand they could pay $3,000 for the second. Markets typically have a minimum of eight territories, the country says,

While franchisees are allowed to invest in a territory at their own comfort range, the discount incentivizes vets to acquire — and own exclusively — more territory, says Cameron Wears, the company’s franchise development manager.

The company likes the idea of more vets owning 1-800-JUNK territories.

"We do feel that from a leadership and management standpoint vets do make good franchise partners," Wears says. "There is a lot of discipline there. …People that are too entrepreneurial don’t succeed in franchise systems because they tend to want to do everything on their own."

"For us it’s another pool of candidates that are out there that have got that leadership and management experience and a lot of them have some money tucked aside," he says. "The criteria that we need to see in a candidate they already bring to the table."

This article was republished with permission from TheStreet.


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