And the Survey Says...

Good News for Franchise and Small Business Owners

by Patricia Schaefer

Two separate press releases -- one from the Office of Advocacy, U.S. Small Business Administration (SBA) and the other from Franchise Business Review -- hold good news for franchise and small business owners alike.

Franchise Business Review, a national franchise market research firm, just released a new report which shows that 72% of franchisees believe that their growth opportunity is strong to very strong. The report is an industry-wide study of franchisee satisfaction compiled from responses from over ten thousand franchise owners in the U.S. and Canada.

"The economy may be weakening in many places but franchisees are very positive about their growth," states Eric Stites, President of Franchise Business Review, in their June 2006 release. "When you consider the little known fact that the top 50 public franchise companies have outperformed the S&P 500 by 70% over the last six years, you can understand why franchise owners are so optimistic. The focus of the media is always on the 'doom & gloom' of the economy... meanwhile, the franchise industry is booming! More people should stop watching the stock market tumble and consider buying a franchise business."

The 2006 Industry Report on Franchisee Satisfaction is available for free download on the Franchise Business Review company website at http://www.FranchiseBusinessReview.com.

From the SBA there was more good news for small business owners overall: Their recently released study shows that households owning small businesses were more likely to be found in the top echelons of income and wealth than those that did not own a business (Demographic characteristics over the 1992-2001 period were examined). However, their comparative share of income and wealth fell during the same period; a decline from nearly 42.5 to just under 40.6 percent of aggregate household wealth.

In 2001, small business-owning households were more than twice as likely as non-business owning households to be high income, and over eight times more likely to be high wealth households. (Households with $50,000 or more total household income in 1992 dollars are classified as high income. Households with $1 million or more of net worth in 1992 dollars are classified as high wealth.)

Dr. Chad Moutray, Chief Economist for the Office of Advocacy, is quoted in the June 2006 release as saying, "Business ownership has traditionally been a route to prosperity for Americans. This study confirms that the 1990's were no different."

The actual full copy of this report shows some other noteworthy findings. They include:

• Households with more than one small business are more likely to be high income earners and high wealth holders than those with only one small business. (In 2001, 37.6 percent of small business owners who owned and managed multiple businesses were high wealth households, while only 16.6 percent of small business owners who owned and managed a single business were high wealth households.)
• The number of households owning small business has remained quite stable at around 12 to 13 million households. (In 1992, there were 12.6 million households owning small business; In 2001, there were 13.2 million)

To see and read the full report released by the Office of Advocacy of the U.S. Small Business Administration, go to http://www.sba.gov/advo/research/rs276tot.pdf.

Copyright 2006, Attard Communications, Inc.