With an Uncertain Market, the US needs to look toward the Middle-Market for an Economic Boost
FALL 2011 FF10 Partners, LLC info@FF10Partners.com
With US governing bodies sealing our fate with the agreement of the debt ceiling, which ultimately led to the S&P dropping our credit score to AA+, the US needs to turn to the middle-market and small business sector to lead the charge and re-stabilize our economy.
In order for re-stabilization in the markets to take place, we need banks to revisit and restructure the lending process, so that business/potential owners can receive funds based on their operational expertise. Seeing that loans stand as the fundamental lever that drives an economy, business plans detailed with complete managerial schematics, backed with the proper personnel to carry out these functions is the most critical component.
Lending institutions need to take an intrinsic look into business operations and management in order to get a real understanding concerning projections for companies, as oppose to the false sense of stability which tax returns show. Understanding growth patterns, ever changing markets and consumer spending habits equates much more to the health and strength of a business as oppose to what a company was able to do in the past with a much different market scope. “Businesses are only as strong as their operation and management team. With that being said, these functions must be exercised on a consistent basis in order to capitalize on a business plan, no matter the sector or size of the company,” Andre Doyle, FF10 Partners, CEO. With banks looking at how the business will leverage its operations as oppose to an underwriter simply looking only at past numbers, we as a society can finally deal with the real issue of failed business, the implementation and execution of a well-defined business and operational plan.
THE ENTREPRENUER: BELIEF
Entrepreneurs are a necessity in any economic climate, especially the one that we currently face. These persons create job opportunities, which ultimately lead people to feel secure in their work. This creates an eco-system where consumers feel comfortable with making significant purchases. With persons borrowing and spending money, our economy becomes greater, which leads to stabilization in markets due to newly created jobs. This simple fact helps our economy become vaster, provides stable markets and introduces more jobs because people are spending more money and taking out more loans.
With created job numbers only totaling 18k in June of 2011, 16k for July, an unbelievable 0 in August and finally a bit of an upswing of 103k in September, it is no wonder why people stopped looking for job opportunities, when they can simply collect a government check and save themselves the embarrassment suffered when they are either rejected from a potential job or simply turned away because of job cuts.
Saying this, the middle-class citizen is often caught in a catch-22 because they cannot go out and capitalize on entrepreneurship due to the lack of loan opportunities. Unfortunately, this holds true no matter how good of an operational and managerial system they have put in place. This also holds true with gainful employment not being found because businesses are not able to expand, causing unemployment rates to soar.
OPPORTUNITIES: MIDDLE MARKET
FF10 Partners serves as a middle-market and small business savior. Through honing in on fundamentals of operations and management, FF10 helps to mitigate the risks that all small businesses face by honing in on strategic planning. By creating partnerships with already existing small businesses and helping to customize approaches for entrepreneurs to reach out to banks, FF10 helps keep hope alive for businesses that would otherwise be faced to file for bankruptcy, sale, face layoffs or completely close. Let’s face it, business owners are not union workers who are guaranteed 401k’s, pensions and other perks that come from working for a large corporation. They are the hardworking, private-sector individuals that our economy largely depends on in order to strengthen our market by applying for loans to grow the company which ultimately leads to the delivery of more jobs. In fact, small businesses account for more than 80% of created jobs in our market. With this being said, we need to look for ways to help those individuals who want to create opportunities for job hunters and market goods for potential consumers; not discourage potential and existing small business owners by not offering them operational or liquid injections to help strengthen net profits.
Additional to working with established firms who have successfully launched their businesses in their chosen field of niche passion, FF10 also facilitates an incubator program to help entrepreneurs get their new startups up and running. Management, financial planning and putting in play our investor resources are some of the many ways we can help spur economic growth. “FF10 reaches out to all people that have visions of growing a company centered on their passion(s) in life because great businesses start with organic ideas. Standard practice is understood that management and financial aspects of running a business thwart startups. Knowing this, our team has provided solutions in Pennsylvania, New Jersey and Florida for now, and we plan to expand the entrepreneur incubator program into most of North America by 2013. We are receiving solid feedback from persons regarding the program,” states Andre Doyle, FF10 Partners.
LICENSING AND PARTNERING
In order to apply these practices, FF10 Partners relies on partnerships and licensing as oppose to franchising for several different reasons. These reasons are because franchising is extremely liquid and capital sensitive. This means, franchisors standard is only to look for individuals who have a net income of at least $150k and have access to a minimum of $100k in liquid. The reality is that most American’s simply do not have that type of capital to start operations, nor the money to continue to feed a business that is in growth mode. Also, franchisor’s hold and can exercise “the first right of refusal.” This means, that even if you meet their minimum requirements, they can still reject you as a holder of their trademark for whatever reason they so desire. This also means they can take your trademark at any time without providing understanding and getting an individual franchisee’s consent.
By licensing and/or partnering with an operational and management company such as FF10 Partners, you ensure that your ideas are still going to be heard and potentially used; you minimize the capital you will have to raise yourself in order to see significant returns, you get to leverage some of your shortcomings in order to simply focus on your niche talent or you take a backseat and become a hands-off point holder. This also allows you to be coached by seasoned veterans of business operations which can serve as an invaluable lesson and with the partnering concept in place; you are able to reach a larger target market, ultimately allowing your brand to become more recognizable.
