Author: Daniel Purim

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Recession-Resistant Industry Segments

Why Senior, Child, and Pet Services Thrive in Any Economy?

In times of economic instability, businesses across various sectors often face significant challenges. However, some industries stand resilient, continuing to grow even when others struggle. Among these are seniors, children, and pets—three groups that hold a special place in our lives, making the services they require essential. 

Our emotional bonds with them mean their needs are always prioritized, and the services they depend on—whether for care, health, or development—are not luxuries but necessities. Let’s explore why these sectors are recession-resistant and look at subcategories within each.

Most of these subcategories also present great opportunities for E-2 Visa investors.

1. Senior Services: The Growing Demand

As the US population ages, with an estimated 11,000 people turning 65 every day, the demand for senior services continues to rise. With a greater focus on aging in place and maintaining quality of life, services for the elderly have become increasingly essential. In tough economic times, families prioritize their loved ones’ well-being, making this a recession-resistant industry.

Key Subcategories of Senior Services:

  • Medical/Non-Medical In-Home Care
  • Elderly Advocate
  • Senior Care Placement Services
  • Non-Medical Transport
  • Downsizing & Estate Sale

2. Child Services: Prioritizing Care and Development

For parents, the well-being and development of their children are paramount, regardless of the economic climate. Child-related services address needs rather than wants, making them essential even in tough times. Parents will always invest in their children’s education, health, and overall care. This explains why businesses in this segment are resilient during economic downturns.

Key Subcategories of Child Services:

  • Tutoring
  • After-School Enrichment
  • Child Fitness Programs
  • Child Hair Salon
  • Nanny Services

3. Pet Services: An Unwavering Commitment to Our Furry Friends

Pets are not just animals; they are beloved members of the family. Even in difficult financial times, pet owners prioritize their pets’ well-being, making the pet service industry remarkably resilient. This is especially true for essential services such as grooming, boarding, and veterinary care. During the years of COVID, the pet adoption rates have skyrocketed, adding more demand for services in this segment.

Key Subcategories of Pet Services: 

  • Mobile Pet Grooming
  • Pet Shops
  • Pet Boarding & Daycare
  • Dog Training
  • Pet Nutrition

Why Emotional Connection Matters

One of the common denominators across these three industries is the emotional connection we have with children, seniors, and pets. These relationships are deeply rooted in care and responsibility, and they transcend economic concerns. People will always prioritize the well-being of their children, elderly family members, and pets, which is why these sectors continue to thrive even when other industries are hit by recession.

Benefit for the Investors

For prospective franchisees, considering recession-resistant industries like child services, senior services, and pet services is a smart strategy. These industries provide essential, need-based services that are not easily cut from family budgets, even in tough times. With emotional connections at the core of these services, they offer stable, long-term opportunities for growth. Whether you are looking to invest in daycare, home care for seniors, or pet grooming, these industries are reliable options for economic resilience.

Franchise businesses in these segments will continue to serve a growing demand, ensuring they remain profitable in any economic environment.

Who We Are

Franchise Wizards is a franchise consulting company located in Carlsbad, CA – USA, and we work with prospective franchisees interested in investing in any market in USA and Canada. We help our clients identify the best franchises for their situations and goals and provide education and coaching on the best practices to evaluate and compare franchise opportunities.

Our Franchise Matchmaking service is offered free of charge for the prospective franchisees, as we are paid by the 700+ franchisors who rely on our expertise to find the ideal franchisee partner. We also welcome E-2 Visa investors.

Schedule now your Free Strategy Session.

There is absolutely no obligation to invest in any of the franchises we suggest for your consideration.

Schedule Now
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Another E-2 Visa Success Story

This episode of the Franchise Hot Seat Podcast hosted by Dr. John P. Hayes on Youtube holds special significance for me for a few reasons, as described below:

1. It’s incredibly rewarding to see our client Pat Rossi featured as their guest, sharing his journey from Canada to the USA. Pat is one of our many E-2 Visa success stories.
 
2. Dr. John P. Hayes is the chair for the Titus Center for Franchising at Palm Beach Atlantic University. He is one of the most important voices in the U.S. franchising industry and, through his program, he is forming the next generation of franchise professionals.
 
3. His testimonial is given to a 3rd party which makes it as genuine as possible and showcases the work with do at Franchise Wizards.
 
I had the privilege of working with Pat during his franchise search for an E-2 Visa, and provided coaching during his franchise discovery process, so he could be in position to make an informed investment decision. We then sought the “blessing” of his Immigration Attorney before he made any formal commitment with the franchisor.
 

The franchise Pat Rossi invested in as the qualifying business for his E-2 Visa is Image One USA – Facility Solutions.

A low-cost commercial cleaning company, extremely E-2 Visa friendly. 

Why should you consider a franchise opportunity in the commercial cleaning segment?

  • Executive Model: The investor retains the executive functions (administration, marketing, sales, recruiting, etc.) but hires the cleaners. The investor is NOT the cleaner!
  • Low-Cost: specially important for E-2 Visa investors who come from countries facing unfavorable foreign exchange rates to USD.
  • Highly Scalable: Add multiple teams to your operations or — if you are an empire builder — stack multiple adjacent territories, all operated from the same “base”.  (*) Pro Tip: by going multi-territory operated from the same “base”, you dilute your occupancy costs.
  • Recurring Revenues: cleaning is needed on a regular basis. How do you like charging your customers multiple times?
  • Predictable Revenue: Most of the recurring work is contract-based. How would you like to know today, how much revenue is already secured for the next month?
  • Favorable Exit Strategies: Businesses with recurring revenues under contract resell for a larger multiplier than a traditional local-reach business with transactional revenues.

If interested in learning more, you can request information directly on the form on this page.

Image One USA Facility Solutions

Franchise Fee: $29,750
Royalty: 10%
Total Investment: $43,625 - $61,225 (includes the Franchise Fee)
Can Be Home Based: Yes (for E-2 Visa investors operate from small office-warehouse)
Founded: 2011
Franchised: 2011
VetFran Member: Yes

Who We Are

Franchise Wizards is a franchise consulting company located in Carlsbad, CA – USA, and we work with prospective franchisees interested in investing in any market in USA and Canada. We help our clients identify the best franchises for their situations and goals and provide education and coaching on the best practices to evaluate and compare franchise opportunities.

Our Franchise Matchmaking service is offered free of charge for the prospective franchisees, as we are paid by the 700+ franchisors who rely on our expertise to find the ideal franchisee partner. We also welcome E-2 Visa investors.

Schedule now your Free Strategy Session.

There is absolutely no obligation to invest in any of the franchises we suggest for your consideration.

Schedule Now
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Franchising vs. Independent Business?

Entrepreneur building the parachute.

Every day prospective E-2 Visa investors face the critical decision of whether to invest in a franchise or start an independent business.
 
This choice often highlights a need — or a desire — for structure and guidance.
 
While some “true entrepreneurs” may thrive by jumping off a cliff and building the parachute on the way down, franchising offers a much more predictable path—especially important for foreign nationals planning to move to the USA with their families under the E-2 Visa program.

Entrepreneur building the parachute.

Relocating to a new country is no small effort. When you factor in kids, schooling, finding a new home, and navigating an unfamiliar business landscape, the challenges multiply. Labor laws, operating costs, and the lack of a local professional network can add to the complexity.
 
Franchising provides a framework where entrepreneurial spirit can thrive with support.
Good franchisors can turn months of effort into days, helping franchisees avoid costly trial-and-error mistakes.
 
From an E-2 Visa application perspective, a franchise system translates into credibility. It allows investors to present a solid business plan backed by a proven track record documented in the federally regulated Franchise Disclosure Document.
 
Know someone grappling with this decision? Since 2016, I’ve worked primarily assiting foreign nationals navigate franchise investments for E-2 Visa applications.
 
Share this post or schedule a suitable time connect by clicking the big green button on the bottom of this page.

Who We Are

Franchise Wizards is a franchise consulting company located in Carlsbad, CA – USA, and we work with prospective franchisees interested in investing in any market in USA and Canada. We help our clients identify the best franchises for their situations and goals and provide education and coaching on the best practices to evaluate and compare franchise opportunities.

Our Franchise Matchmaking service is offered free of charge for the prospective franchisees, as we are paid by the 700+ franchisors who rely on our expertise to find the ideal franchisee partner. We also welcome E-2 Visa investors.

Schedule now your Free Strategy Session There is absolutely no obligation to invest in any of the franchises we suggest for your consideration.

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Conducting Better Validation Calls

Validation Call
Update from franchisor.
Extract from email with update from franchisor, showcasing how well-prepared our client presented herself during their validation call.

During the franchise discovery process, we help our clients stand out as strong, qualified candidates, leaving a lasting positive impression on both the franchisor and franchisees. 

Why does this matter? Because the franchise discovery process is a two-way evaluation, not a hard sales pitch as many might think. Experienced franchisors are ready to turn away candidates who aren’t the right fit for their system.

First-time prospective franchise investors often don’t realize that, before making any investment decision, they have the opportunity to connect with existing franchisees of the system they’re evaluating through validation calls.

While this step in the discovery process isn’t mandatory, it’s widely regarded as a best practice.

These calls add invaluable “color” to the learning process, offering real insights into the franchise system and firsthand experiences from those already operating the business under evaluation.

Now, about the burning question everyone wants to ask: “How much money do you take home?” Here are my thoughts:

1. Asking this question point-blank to someone you’ve just met can put the franchisee on the defensive.
2. This information alone is useless without context.

How long have they been in business? What was their background before franchising? Where is their franchise located? At what revenue level? Does it take into consideration any debt service?

These are a few examples of critical questions that can completely change the interpretation of the answer provided by the franchisee.

As a prospective investor, it’s crucial to understand how money flows in and out of the business. You don’t need a fancy P&L—just a basic understanding to identify the major cost drivers that impact the bottom line. Factors like occupancy costs, labor, and insurance need to be calibrated to your market.

Simply asking how much money someone takes home—without considering the bigger picture—isn’t helpful.

At Franchise Wizards, we prepare our clients for these critical conversations, ensuring they use their time wisely and stand out as strong, qualified candidates. The image is an update I received from a franchisor today!

Making an informed investment decision is important—let’s make sure you make the most out of the franchise discovery process.

Who We Are

Franchise Wizards is a franchise consulting company located in Carlsbad, CA – USA, and we work with prospective franchisees interested in investing in any market in USA and Canada. We help our clients identify the best franchises for their situations and goals and provide education and coaching on the best practices to evaluate and compare franchise opportunities.

Our Franchise Matchmaking service is offered free of charge for the prospective franchisees, as we are paid by the 700+ franchisors who rely on our expertise to find the ideal franchisee partner. We also welcome E-2 Visa investors.

Schedule now your Free Strategy Session There is absolutely no obligation to invest in any of the franchises we suggest for your consideration.

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The Right Franchise for Your Goals

Multi-Unit, Scalable Business

When it comes to making an investment in a franchise business, having a clear understanding of your goals is important for choosing the ideal business model, as not all franchises are created equal.

As experienced Franchise Consultants, knowing what you are trying to accomplish allows us to quickly eliminate dozens of business models that are not aligned with your interests. The result is focus for your franchise search, so you can invest your valuable time learning about franchises that present the potential you are looking for.

Over the past few years, the goals of the prospective franchisees in the United States who have consulted us about franchise investment have typically fallen in one of the 2 following categories:

  1. Replace a Primary Source of Income
  2. Add a Secondary Stream of Income

1) Replace a Primary Source of Income

For an investor looking to replace its primary source of income, scalability becomes the key factor when choosing the right business model. In this case, the investor is favoring financial performance over comfort as he/she can dedicate time to grow the business.

Scalability is the ability to grow the revenues of the business with incremental investments that represent a fraction of the amount initially invested in order to get in business in the first place AND these increased revenues do not come at the expense of a substantial increase in the fixed operating costs.

In other words, the franchisee can increase the revenues by making smaller incremental investments in such way that does not increase its fixed operating expenses or, at least, not at the same rate. Whenever the business revenues can be increased at a greater rate than its fixed operating expenses, the result is an increase in the profit line.

Even though “bricks-and-mortar” businesses such as fast-food and hair salons (to list a few) are the most recognizable forms of franchise, they are not known for scalability as these businesses have a certain radius of influence around their locations, which limits the growth opportunities.

Think of this: In an urban scenario, most people would not travel 10 miles to stop at your Subway franchise location in order consume a sandwich. The radius of influence of a sandwich shop, as most location-driven businesses, may be limited to a few miles.

The most scalable business models are the ones that do NOT depend on the business’ physical location to attract customers. They are operated from small office spaces, office warehouses or even from a home-office and offer the ability to add multiple teams to one territory or yet to stack multiple contiguous territories serviced from the same “base” (multi-unit deal).

Multi-Unit, Scalable Business

You may want to read our article about “The 4 types of franchise arrangement” and learn about Multi-Unit deals.

2) Add a secondary stream of income

For corporate professionals or a serial entrepreneur considering investing in a franchise business with the objective of adding another stream of income, the ideal franchise opportunity will allow an absentee or semi-absentee operation and, as such, simplicity is the name of the game.

Location-driven businesses are very suitable opportunities for operations that will start semi-absentee. The simpler the sale process, the better.

Semi-absentee operation may be achieved with a hired manager in place or even through automated sales.

Examples of industry categories with ideal conditions for semi-absentee operations are personal care (hair salons, barber shops, spa services, etc.), retail, vending machines, automated laundry services to name a few.

For the investors who do not have any time to dedicate to the business and want to treat it as a passive investment, absentee operations can be achieved with joint-ventures deals, where the investor partners with the operator of the business.

The operator contributes with the specific know-how of the industry as well as management efforts to implement and run the business while the investor funds the operation. This is typically accomplished with a profit-sharing model and the operator reports to the investor on a regular basis.

There are joint-venture opportunities in segments such as vending machines and rural broadband internet services.

One of the best kept secrets franchises for absentee operation is a player in the fast-casual food category. They offer fresh Asian food and they have launched a full-management sister company specialized in their concept.

The investor signs a franchise agreement with the franchisor and a management agreement with the sister company, creating a white gloves solution for someone seeking a passive investment in the food and beverage category.

Who We Are

Franchise Wizards is a franchise consulting company located in Carlsbad, CA – USA, and we work with prospective franchisees interested in investing in any market in USA and Canada. We help our clients identify the best franchises for their situations and goals and provide education and coaching on the best practices to evaluate and compare franchise opportunities.

Our Franchise Matchmaking service is offered free of charge for the prospective franchisees, as we are paid by the 530+ franchisors who rely on our expertise to find the ideal franchisee partner. We also welcome E-2 Visa investors.

Schedule now your Free Strategy Session There is absolutely no obligation to invest in any of the franchises we suggest for your consideration.

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The 4 Types of Franchise Arrangement

4 types of franchise arrangement

The franchising industry is very diverse, not only in terms of industry categories, but also in terms of franchise arrangements. Learning about the four main types of arrangement will help you define the best approach for your goals. One of these arrangements is a “hidden gem”!

4 types of franchise arrangement

1) Single Unit

A single unit franchise is what most people think of when considering franchise investment. It results in a franchise agreement in which the franchisor grants the franchisee the rights to open and operate one franchise unit.

This is the simplest and most common type of franchise, and many new franchisees start this way. There are many instances in which a franchisee starts with a single-unit operation, learn the business, and later acquires the rights to open additional units.

This is the standard franchise offering. Typically, there is no room for negotiation or other incentives.

2) Multi Unit

A multi-unit franchise deal results in an agreement in which the franchisor grants a franchisee the rights to open and operate more than one unit. The franchisee signs a commitment to open two or more units. The opening of the second and subsequent units may follow a pre-determined schedule.

Multi-Unit franchisees typically benefit of some incentive from the franchisor, such as a discounted franchise fee for the second and following units.

Investors considering franchise investment as an additional stream of income while keeping their corporate jobs can dilute the cost of hiring one manager among several franchise units located in the same market. Other operational benefits such as shared employees, shared service vehicles or shared inventory may also be applicable.

3) Area Development

As an Area Developer, the franchisee secures the exclusive rights to own multiple units within a large territory (i.e., whole county or whole state). As compared to the multi-Unit agreement, in the Area development agreement, the franchisor grants the franchisee exclusive rights for the development of that territory. For example, a franchisee may agree to open 10 units over a five-year period in a specified territory. That territory is restricted to the Area Developer, and no one else can own units in the territory during the contract term.

There are economies of scale associated with this type of arrangement and the Area Developer can avoid other franchisees competing for the same market.

4) Master Franchise

The Master Franchise deal is, as mentioned in the intro, sort of a “hidden gem” in franchising. It can be a great path for building wealth and residual income!

A Master Franchise Agreement is another multi-unit option, but it differs from the Area Development arrangement above mentioned in terms of rights and obligations.

In the Master Franchise arrangement, the Master Franchisee steps on the shoes of the Franchisor in its protected territory. The territory can be developed by selling franchises to third parties (sub-franchisees).

Different than the Area Development arrangement, the Master Franchisee takes over many of the tasks and duties of the franchisor, such as providing training and continuous support to sub-franchisees and as mentioned, the activities related to franchise sale in that territory.

The reward by acting as a franchisor in the protected territory, is to receive part of the franchise fees and royalties from the franchisees in the territory. Those royalties will provide a residual stream of income for the Master Franchisee.

The most common use of Master Franchise arrangement is when a franchisor wishes to enter a new geographical territory where they have no knowledge of the market or the culture. Although some franchisors offer Master Franchises for markets inside the USA, very often it is the preferred method for international expansion where the Master Franchisee plays the role of the Franchisor in his/her country.

Who We Are

Franchise Wizards is a franchise consulting company located in Carlsbad, CA – USA, and we work with prospective franchisees interested in investing in any market in USA and Canada. We help our clients identify the best franchises for their situations and goals and provide education and coaching on the best practices to evaluate and compare franchise opportunities.

Our Franchise Matchmaking service is offered free of charge for the prospective franchisees, as we are paid by the 530+ franchisors who rely on our expertise to find the ideal franchisee partner. We also welcome E-2 Visa investors.

Schedule now your Free Strategy Session There is absolutely no obligation to invest in any of the franchises we suggest for your consideration.

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In The Right Place, At The Right Time!

What happens when a mature franchise development group acquires a small franchise brand in a fragmented industry segment? Opportunity!

This is exactly what is happening in the Junk Removal industry, a $10 Billion industry segment. And if you are looking for an opportunity that does not happen everyday, consider learning more about this recession resilient industry.

The Competition

In a fragmented industry, the competition is mostly formed by small independent business operations, with limited market share, limited resources and no single player has enough influence to move the industry in a particular direction.

Picture your competition formed mostly by small players with unprofessional presentation (i.e. unbranded vehicles and/or employees without uniforms), no formal processes in place, resulting in inconsistent and unreliable service, which translates as poor customer experience.

Have you ever called a service provider, left a voicemail, and never heard back from them? That’s what I am talking about!

The Opportunity

An experienced franchise development group with several brands under the umbrella and a combined total of over 220 franchised units in operation is positioned to take a small franchise brand to unprecedented growth by leveraging the resources they already have such as in-house marketing agency and, in some cases, an inbound call center. Yes, you’ve read it correctly! A franchisor that actively helps you in the sales cycle!

These mature franchise development groups have the experience fine-tuning business systems for increased efficiency, scalability, consistency of the service provided across the entire franchise system and an unbelievable customer experience.

I invite you to learn more about the Junk Removal franchise that is poised for growth.

  • Low Initial Investment: under $140,000 (in which at least $50,000 must be from non-borrowed funds)
  • Lowest Royalty Fee in the Industry Category: 6%
  • Industry Size: $10 Billion
  • Recession-Resistant, Essential Service. Did not stop as result of COVID!
  • Fragmented Competition
  • Environmentally Friendly: Donation, Recycling, Repurposing…. Landfill as last resource.
  • No-Inventory
  • No Storefront (it can be managed from home)
  • Scalable (multiple trucks in one territory and/or multiple contiguous territories)
  • E-2 Visa friendly

Click the button below to schedule your free franchise consultation.

Who We Are

Franchise Wizards is a franchise consulting business located in Carlsbad, CA and we work with 530+ franchisors in multiple industry categories with various investment levels. The location where the desired business is to be operated can be anywhere in the USA or Canada.

By understanding your objectives and your business preferences, we can present to you a tailored selection of franchises that meet your requirements and present the qualities you are looking for in the ideal business opportunity.

We can also educate you on how to make the most out of the discovery process offered by the franchisors and the best practices to evaluate and compare franchise opportunities.

Schedule now your free franchise consultation. There is absolutely no obligation to invest in any of the franchises we suggest for your consideration.

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10 Reasons Why You Should Not Buy a Cheap Gas Station

You Should Calibrate Your Expectations

Many prospective investors reach out to us to discuss franchise opportunities, often expressing interest in purchasing an existing gas station business listed under $150,000 on various business brokerage websites.

At first glance, this may seem like a great bargain. Many envision a ready-to-go business with semi-absentee operation, where an employee manages the convenience store and oversees customers at the self-service gas pumps. Meanwhile, the investor plans to dedicate just a few hours a week to managing finances and counting the money.

They usually assume that there’s endless demand for fuel, leading to easy sales and a steady cash flow month after month.

What’s wrong with this picture? Well… almost everything!

This article will offer you a different perspective on the “fantasy” of a cheap gas station business described above. 

If you’re a prospective E-2 Visa investor, please read this article twice!

On a side note: It’s important to clarify that a gas station can be a profitable business that provides steady cash flow month after month. However, the profitable gas stations are not the cheap ones that attract the attention of so many prospective investors. These so-called “cash cows” are located in high-traffic areas, which come with high occupancy costs and typically sell for more than $1 million. There are many aspects you should thoroughly investigate before buying one.

Here are 10 reasons why you should not buy a cheap gas station:

1. Small Margins: Gas profit margins are around 2%, according to NACS, the leading global trade association for advancing convenience and fuel retailing. With such thin margins, gas station operators have very little room for error. It’s safe to say that a gas station must offer ancillary services, such as a robust convenience store and/or auto services like oil changes or car washes, to survive. Low margins often result in longer hours of operation, sometimes 24/7, forcing single-store operators to work actively in the business (owner-operator) not because they want to, but because they have to.

2. Location and Changes in Traffic Patterns: Gas stations are location-driven businesses, and their success heavily depends on being situated in high-traffic areas with easy access for customers and, ideally, in regions with limited competition (which is often not the case). Don’t overlook the possibility of future changes in traffic patterns due to road work, which could disrupt the routes drivers use to access the gas station. These projects can last for many months or even years. Could this be an undisclosed reason for the discounted sale of that business operation? In the gas station business, if the location isn’t right or if access is compromised by road work, there’s not much you can do to overcome it.

3. Personal Safety / Workplace Violence: Cheap gas stations are often located in less desirable neighborhoods. According to enterprisenews.com, “Occupational-safety advocates say the clerks, attendants, and cashiers who staff the counters at gas stations and corner grocery stores, often alone and late into the night, are among the most vulnerable to workplace violence and harassment.” Gas station attendant is ranked as one of the most dangerous jobs concerning workplace violence, not too far behind law enforcement officers, according to an article published by Hirewise under the title “Workplace Violence: High-Risk Jobs.”

4. High Competition: Gas stations heavily rely on being in high-traffic areas with easy access for customers. It’s common to see multiple gas stations competing at busy intersections, leading to a price war that benefits no one. MarketWatch estimates there were about 115,000 gas stations in the USA as of 2020. However, the number of gas stations has been decreasing over the past two decades. Ask yourself why! This decrease is attributed to reduced margins for owners and overall reduced fuel consumption. Don’t ignore these market forces!

5. Environmental Issues: One of the costliest mistakes a prospective investor can make when considering buying an existing gas station is to only assess the condition of the above-ground installation. To avoid the risk of buying a gas station that is leaking fuel, prospective investors should contract comprehensive soil testing as a condition of purchase. The last thing you want is to endure the expensive cleanup costs of removing contaminated soil and the loss of revenue during remediation and rebuilding. So, if you want to do the transaction correctly, you’ll likely need to spend money on soil testing before determining if the acquisition is viable.

6. Outdated Installation: Cheap gas station business listings frequently (and conveniently) do not mention any additional Capex (Capital Expenditure) necessary to upgrade outdated installations. Are the fuel storage tanks DWFG (double-walled, fiberglass) with leak detection sensors? What about the fixtures, furniture, and equipment (FF&E) in the convenience store?

7. Hard to Estimate Profits: It’s important to note that gas stations are subject to fluctuations on both the supply and demand sides, making it a tough business to estimate profits. Oil prices are traded as commodities, subject to geopolitical and economic forces on a global scale, and consumption patterns fluctuate with the price at the pump, the overall economic scenario, or even the weather. It’s common for gas station owners to see a decrease in net profit when prices at the pump increase. Higher prices drive customers away from the gas station and its convenience store, where profit margins for pre-packaged food, beverages, and other items tend to be higher than for fuel.

8. EV, Hybrid, and Fuel-Efficient Vehicles: Advancements in fuel-efficient cars and electric vehicles (EVs) are notable drivers of reduced fuel consumption. America is slowly but surely adopting EVs, hybrids, and fuel-efficient vehicles. More and more companies are embracing aggressive sustainability initiatives. A prime example is Amazon’s pledge to be zero carbon by 2040. In their sustainability report, they announced an order for 100,000 electric vehicles. Amazon is a trendsetter, and you can be sure that more companies will follow their lead.

9. Replacement Cost: How much does it cost to build a brand-new gas station with a convenience store? Anywhere from $500,000 to $2.5 million, depending on multiple variables. So, from the perspective of replacement cost, why do you think you’ll buy a cheap gas station, and everything will work just fine? Why would someone sell you a gas station “full of potential,” as they say, at a fraction of the replacement cost? Obsolete installations, known future changes in traffic patterns, aggressive competition pressuring net margins, or possible environmental issues could be the reasons, as mentioned above.

10. Lack of Financial Information: Many sellers of gas stations offer limited or no financial records, which is a major red flag. If you’re an E-2 Visa investor, then this is a major “No, No, No!” Here’s an example extracted directly from one of the major business listing websites: What a bargain! Asking price is $30,000, with no financial information whatsoever. The business has been established for at least eight years, meaning most of the productive assets have likely been stripped of depreciation, and the owner claims it’s an absentee operation (run by employees). Yet, the reason for the sale is the seller’s relocation… Really?

If you’re seriously considering investing in a franchise business or want to gain knowledge about franchising to later decide if it’s the right type of investment for you, we can definitely help. Prospective E-2 Visa investors are welcome, and we have extensive experience with investment visas.

Who We Are

Franchise Wizards is a franchise consulting business located in Carlsbad, CA. We work with 700+ franchisors across multiple industry categories and investment levels. The location where the desired business is to be operated can be anywhere in the USA or Canada.

By understanding your objectives and business preferences, we can present you with a tailored selection of franchises that meet your requirements and align with the qualities you seek in an ideal business opportunity.

We can also educate you on how to make the most of the discovery process offered by franchisors and share best practices for evaluating and comparing franchise opportunities.

Click the big green button below to schedule a free consultation. There is absolutely no obligation to invest in any of the franchises we suggest for your consideration.

Schedule Now
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Beware of Turnkey Freight Transportation Businesses for E-2 Visa

There are few companies in the USA that offer a turnkey freight transportation business. Some of them promote those business opportunities as a qualifying investment vehicle for E-2 Visa applicants.

They frequently post on groups on diverse social media platforms and their posts generate a lot of interest from the group members that are lured to believe this is the best investment option for their E-2 Visa application. This is a reason for concern, and it has motivated me to write this article and provide you another perspective for your consideration.

At a glance the offer seems very attractive but there are some fundamental aspects and market trends that should not be overlooked.

The Offer

The offer typically calls for low investment ($150K – $200K), high-margins (up to 20%), you invest in your own company (freight carrier), the turnkey seller will assist you with the implementation of the business including the acquisition of the truck and will provide you with freight contracts (freight brokerage).

The turnkey seller highlights how important the freight transportation industry is for the US economy and informs that the demand for transportation services is greater than the offer.

From the E-2 Visa investment perspective, there is nothing wrong with investing in your own company and buying a productive asset (truck) but this business model, as proposed, has some fundamental problems you should be aware of.

You do not control the customer acquisition process.

Your newly formed company heavily relies on contracts flown down by a freight broker (very often the turnkey seller, or an affiliated company).

Your company does not have its own marketing and sales capabilities, resulting in inability to attract new customers on its own. It is like having only one customer: the freight brokerage firm.

How do you like a business that only has only one customer? Sounds risky, right?

By the way this is the same type of risk of those local UPS route businesses that you may see listed in the “business for sale” websites. Yes, essentially you would be putting all the eggs in one basket and voluntarily becoming hostage of one single customer. If they change the way they want to do business, that would directly affect your operation.

For an E-2 Visa investor, who moved his/her family to the USA with the sole intent of managing that business, a risk of that nature could mean to pack the bags and go back to home-country, in case the business does not make sense anymore.

Having to rely on 3rd parties to get freight contracts creates an unnecessary risk that a regular business that has its own marketing and sales capabilities would not incur and it may be subject of scrutiny by immigration officials reviewing your E-2 Visa application.

Small Margins

The freight transportation segment is highly competitive in the USA, which puts pressure on the profit margins.

Even though there are multiple subcategories of freight transportation including some specialties (i.e. reefer trucks), you should think of freight transportation as commodity service. Is it so commoditized that there are innumerous freight bidding platforms out there, so yes, it is a price war! Not much room for differentiation.

Back to the freight transportation turnkey offer abovementioned, if your business setup heavily relies on contracts flown down by freight brokers, your margins should be even smaller, since the broker must make a profit.

Owner-operated business

By investing in the freight transportation turnkey business, you will be buying yourself a job, not a business. The economics could work for an owner-operator but with small margins it will be somewhat challenging to scale up that operation into an Executive business model.

The Executive business model is the ideal business model for an E-2 Visa application because the investor retains the administrative functions (very often marketing and sales as well) and hires the employees that will perform the services that are being offered and/or produce the products that are being sold. Using the freight transportation industry segment as an example, the investor should be able to hire the drivers (configuring an Executive Model), instead of being the sole driver (configuring an Owner-Operator Model).

Beware of businesses that look like “self-employment” as they run greater risk of being considered “marginal enterprises” by the immigration, which would result in E-2 visa denial.

Industry trends that should not be overlooked

The freight industry is going through market consolidation (merges & acquisitions). Large players benefit from economies of scale, which is key in a market segment with small margins.

Disruptive technologies such as driverless trucks and electrical trucks are up and coming and they aim for cost efficiency.

Apps that match shippers with carriers such as “Uber Freight” are here to stay. It allows independent (owner-operator) truck owners to get freight jobs but again, the same challenge as relying primarily on contracts flown down by freight brokers apply. The app will bite your margins.

There are increased regulations in the freight industry. Here are some examples:

Reclassification of Independent Contractors

A good example is the “Dynamex Operations West, Inc.  v. Superior Court of Los Angeles” ruling has made it harder for companies to misclassify workers as independent contractors going “against the grain” of an industry trend that since the 70s has been shifting from “employment model” to “independent contractor model”. Assembly Bill 5 (AB 5) is a new California state law that redefines and limits the way businesses classify workers as independent contractors. Great chances are that other states will soon establish their own versions of California AB 5.

Federal Motor Carrier Safety Administration Drug & Alcohol Clearinghouse

FMCSA Drug & Alcohol Clearinghouse will serve as an online database that will allow relevant parties to identify whether a Commercial Driver’s License (CDL) holder has violated any federal drug and alcohol testing program requirements within the past five years. Safety always comes first! Even though the initiative is welcome, it will increase the complexity of running a freight transportation business.

Proposed changes to hours of service

While having commercial drivers electronically tracking their hours of service in a digital recording device synced up with the trucks’ engines has increased compliance to maximum hours of service (again, increasing safety!), it has also created some secondary challenges and there are proposed changes to those regulations, again, adding complexity to running a freight transportation business.

If you are seriously considering investing in a business or gain knowledge about franchising so you can later decide if this is the right type of investment for you, we can definitively help you. Prospective E-2 Visa investors are welcome, and we have a lot of experience with investment visas.

Who We Are

Franchise Wizards is a franchise consulting business located in Carlsbad, CA and we work with 530+ franchisors in multiple industry categories with various investment levels. The location where the desired business is to be operated can be anywhere in the USA or Canada.

By understanding your objectives and your business preferences, we can present to you a tailored selection of franchises that meet your requirements and present the qualities you are looking for in the ideal business opportunity.

We can also educate you on how to make the most out of the discovery process offered by the franchisors and the best practices to evaluate and compare franchise opportunities.

Click bellow to schedule a free consultation. There is absolutely no obligation to invest in any of the franchises we suggest for your consideration.

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Can real estate investment qualify you for E-2 Visa?

In most countries, real estate is perceived as a solid investment vehicle and uninformed E-2 Visa prospective investors believe that investing in real estate in the USA would qualify them for the E-2 Visa: It will not!

Many real estate business models fail to demonstrate that the company is a real, operating business and not just a passive investment.

This article will not only explain the reasons why diverse types of real estate investment will not qualify you for the E-2 Visa, but will also present you some E-2 Visa compliant franchise business opportunities that can put you in the real estate industry segment.

Buy & Hold

In this form of real estate investment, the investor acquires a property (or gain control over a real estate property) that will later be rented to a tenant. The whole idea is that the monthly installments paid by the tenant will exceed the operating expenses of holding that property, resulting in positive cashflow while investor builds equity on the property over time (in case of financed purchase).

The passive nature of this type of investment is detrimental to your E-2 Visa application. Not a real, operating business. No employment generation.

House-Flipping

Buying properties under market value, remodeling it and reselling for top-market value while holding it for the least amount of time possible is a type of real estate investment commonly known as “house-flipping”.

This form of real estate investment has become very popular due to TV shows, notably the ones on the HGTV channel.

This type of business only makes sense if the property is acquired at significant discount. This is not the typical real estate transaction. The “supply” side of your business is scarce and uncertain, which makes this type of business extremely speculative, which is detrimental to your E-2 Visa case and your business will not be interpreted as a real operation by the immigration.

The speculative nature of these transactions, by the way, is the same reason why stock market investment will not qualify you for the E-2 Visa.

Notes Investment

In real estate, whenever someone finances the acquisition of the property, the borrower typically signs a “promissory note” that documents the intent to repay the lender. In real estate, it is very common for those notes to have the real estate property itself as the collateral, so if the borrower defaults the repayment, whoever holds the note (a bank or an investor) can foreclose the property and take it back as guarantee.

Again, very speculative nature, passive investment and no employment generation. It will not serve as an investment vehicle for your E-2 Visa.

Alternative Businesses in the Real Estate Industry

If you are passionate about real estate and wants to be in this industry, here are some business categories that present E-2 Visa compliant franchise models and E-2 Visa friendly franchisors.

Property Management Franchises

Property Management is a real business. The property manager acts on behalf of the property owner and manages the relationship with the tenants while preserving the value of the properties.

There are diverse classes of assets that can be managed by a property management company: residential short-term rentals, residential long-term rentals, associations management and commercial properties.

This line of business present multiple streams of income, including transactional and recurring revenues. The business can be grown organically or by acquisition of property management contracts. Some franchisors assist franchisees in identifying and negotiating those contracts when they become available in the market.

Initial investment typically falls between $70,000 and $115,000, not including acquisition of property management contracts.

There are several property management franchises in the USA but only a few are E-2 Visa friendly.

If you are interested in this segment, we can definitively connect you with the franchisors who are E-2 Visa friendly and have extensive track record of E-2 Visa approvals.

Property Inspection Franchises

According to the American Society of Home Inspectors (ASHI), more than 90 percent of home sales involve a house inspection. These inspections are typically conducted after the purchase offer has been accepted and before the deal is considered closed. This timeframe is known as contingency period and depending on the findings, buyer may back out of the deal or renegotiate the deal if something major comes up.

Generally, a home inspection will report on the condition of roof, installations, HVAC, finishing (floors, walls and ceilings), structure, foundations, basements and may include other specialty inspections such as termites, asbestos, radon and lead, to name a few.

Initial investment typically falls between $70,000 and $100,000 and, even though there are several franchises in this segment operating in the USA, most are either not E-2 Visa friendly or they offer an “owner-operated” business model, which is not ideal for the E-2 Visa.

If you are interested in this segment, we can definitively connect you with the franchisors who are E-2 Visa friendly and offer an Executive business model, allowing the franchisee to hire the property inspectors instead of being the only inspector. Remember: any business that looks like self-employment will likely not qualify you for the E-2 Visa.

Conclusion

Property Management and Property Inspection franchises present E-2 Visa complaint business opportunities that can get you inside the real estate industry. Being an insider in the real estate industry creates the perfect condition to have a side-business in real estate investment, if this is your end goal.

Make sure to consult a competent immigration attorney on how to setup the legal entities in such way to allow you to stack up diverse business opportunities without jeopardizing your E-2 Visa.

If you are seriously considering investing in a business or gain knowledge about franchising so you can later decide if this is the right type of investment for you, we can definitively help you. Prospective E-2 Visa investors are welcome, and we have a lot of experience with investment visas.

Who We Are

Franchise Wizards is a franchise consulting business located in Carlsbad, CA and we work with 530+ franchisors in multiple industry categories with various investment levels. The location where the desired business is to be operated can be anywhere in the USA or Canada.

By understanding your objectives and your business preferences, we can present to you a tailored selection of franchises that meet your requirements and present the qualities you are looking for in the ideal business opportunity.

We can also educate you on how to make the most out of the discovery process offered by the franchisors and the best practices to evaluate and compare franchise opportunities.

Click below to schedule a free consultation. There is absolutely no obligation to invest in any of the franchises we suggest for your consideration.