Welcome back to part two of our series on how you, as a potential pro football player, can avoid becoming yet another statistic of players that end up broke.
Let’s finish up with the last couple lessons I think you can get from Anthony Simmons’ interview with Black Enterprise.
He’s a former NFL and CFL player who now has an organization aimed at helping pro athletes make smart business decisions before their pro careers are over.
Lesson #4 – A LOT of Athletes Buy Into Franchises… But Why?
A lot of pro athletes invest in franchises.
There was a specific question and answer between Black Enterprise and Simmons that made me talk about this:
Q: Why do you feel franchising is a viable way to maintain a stream of income for these athletes and their families?
A: It’s not just franchising. We have wealth management companies and other businesses there that give them opportunities. We go with franchising because a lot of athletes venture out into franchising.
In 12 Reasons for Investing in a Franchise they talk about the benefits to investing in a franchise.
Again, for the record, I’m not trying to tell you to invest in franchises. I’m just trying to reveal why so many athletes are investing in franchises.
Below is the list of benefits they list out to investing in franchises.
After that, we’ll think on the list, and see how many bulletpoints might be beneficial to pro ball players:
- You will have the opportunity to purchase a business concept that has already been tried and tested in the market.
- The risks of setting up a franchised business are substantially reduced when compared to establishing a new business in the same market.
- A franchise will provide a brand image that the public will recognize.
- Business premises will all comply with an established interior and exterior design to assist with brand promotion
- Specifications for the equipment required by the franchise will be clearly identified from the outset.
- Publicity and ongoing marketing can be arranged by the franchisor as part of the contractual agreement.
- Comprehensive training in all aspects of running the business will be given to you by the franchisor, both initially and on an ongoing basis as methods are improved.
- The ‘operations manual’ received as part of the franchise will give standardised procedures for accounting, sales, and stock control.
- The franchisor may be able to provide you with better terms for the centralised bulk purchase of raw materials or goods used by the franchise.
- As the franchisee, you should benefit from the franchisor’s ongoing research and development undertaken to improve the franchised product or service.
- Networking with other franchisees will provide both you and the franchisor with opportunities for review and improvement of the operating procedures.
- The franchise should have a clearly defined geographical area within which the rights of the franchise are protected from other franchises from the same franchisor.
Think about the life of an NFL player, and you can clearly see why franchises are so attractive to pro ballers.
Check out this feature on former NFL players that are doing well in the world of business.
I mean, seriously. Did you read that list of bulletpoints? It’s kinda obvious, isn’t it?
They say that 90% of businesses fail in the first year. If that’s the case , and you’re a pro athlete, it may be to your advantage to invest in something that’s already been tried and tested.
I guess it kinda makes sense… Would you rather open an Outback Steakhouse, or a “John-John’s” sandwich shop, that has to build up a clientele, and develop familiarity in the marketplace?
Branding is a big deal. Buying into a business that already has a brand built into it could potentially make things a little easier for you.
By the way, I’m not promoting buying into a franchise. Anytime you do anything in life, there’s going to be positives and negatives involved.
Lesson #5 – Are you Going to Be Part of the Solution, or the Problem?
In the Black Enterprise article, Anthony speaks of his goal to get the 82% (of athletes that end up broke within two years of retiring) down to 65% by 2015.
Just think of how many NFL players will be better off financially when the “keeping up with the Joneses” mentality has subsided.
What would happen when rookies came into the league and saw veterans with more profitable businesses and investments, instead of expensive cars and houses.
If you’re blessed enough to make it to the league, will you be part of the solution, or the problem?
The earlier you can embrace the discipline to be smart with your money, the better off you’ll be in the long run (as well as your family).
Good luck to you.
By the way, what do “you” think is the biggest reason why so many players end up broke? Leave a comment below!
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