The last entrepreneurial hurrah

Lower risk makes the franchise business a good choice for baby boomers looking for a second career…"What a franchise offers is a lower-risk point of entry." Franchises make good customers because their businesses often have a higher success rate…

The Globe and Mail
April 12, 2006

The last entrepreneurial hurrah
For baby boomers, buying a franchise provides a rejuvenating lifestyle change, not just another job, Brenda Bouw reports.
Brenda Bouw

After a successful career managing international sporting sites, including an Olympic venue, Ray Buckland is abandoning his suit and tie for an apron and oven mitts.

"I was a corporate junkie all of my life, but I hit a stage in my career where I wanted something of my own," says Mr. Buckland, the former general manager of the Sydney Showground, the baseball venue for the 2000 Olympics, and venue director for the 2005 World Masters Games in Edmonton.

Mr. Buckland recently bought a Cobs Bread bakery franchise and plans to open its first Edmonton location in May. The Australia-based franchise is expanding across Canada, and Mr. Buckland saw it as an opportunity to make a career change that would take him into retirement.

"At my age, I started to think about what I wanted to do when I'm 55 and 65," says the 48-year-old Australia native who lives in Edmonton with his Canadian wife.

Mr. Buckland is part of a growing trend of baby boomers leaving white-collar work and buying franchises.

"In the eighties and nineties people were looking at franchises as a way of replacing a job. Now it's seen as more of a lifestyle change," says Richard Cunningham, president and chief executive officer of the Canadian Franchise Association. "Being your own boss is part of that lifestyle change."

One benefit for boomers planning their retirement is the $500,000 capital gains exemption they will have when they eventually sell the business. It can be an added incentive for those who may not have saved as much as they need for retirement, Mr. Cunningham says. Not only are more boomers buying franchises, they are getting into businesses that appeal to their age group, such as health-food stores, gyms, travel agencies and service providers.

"More people are getting older and don't want to clean the eaves-droughts any more. There are even companies that will put up your Christmas lights and take them down," Mr. Cunningham says. "As boomers are inheriting their parents' money they are spending money on these kinds of things."

Wayne Parent, president of Nutrition House Canada Inc., a health food chain with 75 stores across the country, has also noticed a trend of boomers buying his franchise.

"I'm finding these are people who are getting retirement packages or buyouts and are at an age where they are still too young to retire. They want to get into something they can enjoy and work with, even if it's just for 10 years or so," Mr. Parent says.

While younger franchisees bring a lot of energy to the business, boomers sometimes have a management background that is an asset to running the business, he says.

"I find in some cases they are more mature and perhaps have more worldly experience," Mr. Parent says.

Tom Turnbull, president of Kwik Kloset Franchising Inc., a closet organization and installation company, says boomers also tend to have more of the handyman skills his franchise owners need.

Many boomers were raised in the "do-it-yourself world," Mr. Turnbull says, which helps with the installation part of a Kwik Kloset franchise. "You need the ability to deal with people, be comfortable on computers and with numbers, and be a handyman."

After being laid off from his telecom sales job in Denver, Colo., following the crash in the technology sector, Mr. Turnbull, 42, returned to Canada in 2002 with his young family and decided it was time to work for himself.

During the recent home-renovation craze, Mr. Turnbull noticed peoples' increased desire to organize their spaces. His company handles closets, kitchen pantries, garages and office space.

When he created the business in March, 2003, his goal was to make it a franchise operation.

"I packaged it to look like a franchise even though it was just me and a truck at the start," he says. Within a year he had his first franchisee, and today Kwik Kloset has 20 locations in Ontario — 12 are corporately owned and eight are owned by franchisees.

Among the advantages for any franchisee is that buying a brand carries less risk than starting a new business from scratch, Mr. Turnbull says.

Lower risk makes the franchise business a good choice for baby boomers looking for a second career, says Nick Stitt, vice-president of small business banking for TD Canada Trust. "What a franchise offers is a lower-risk point of entry."

Franchises make good customers because their businesses often have a higher success rate, says Mr. Stitt, whose bank has more than 20 lending programs for franchisees.

"It would be a fairly low-risk proposition if they are willing to put in some hard work," he says.

It was the Cobs Bread brand — with 670 locations across Australia and New Zealand under the name Bakers Delight — that attracted Mr. Buckland to the bakery business.

"With a franchise, someone else has already made the mistakes," he says. "Also, there is a whole network, which makes it less lonely than going into your own business."

But his decision was not made without trepidation. Mr. Buckland sold his house in Sydney and took out a loan to finance the roughly $400,000 start-up cost for the Cobs franchise.

"The hardest part to deal with is putting your own fortune on the line. Is it going to work? Am I going to be broke in a year's time? The hardest part was making the decision. It's scary when you are saying, 'I have to sell my house to make this business work.' "

Mr. Buckland recently finished a 12-week training program and is already dreaming of owning a number of Cobs Bread locations and semi-retiring at age 55.

"I want to have a fleet of stores managed by good people and the flexibility to walk away for the day if I want to," he says.

Mr. Buckland is embracing his new lifestyle.

"I don't think I'll ever miss not going to another board meeting."

Special to The Globe and Mail

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