March 2010 Archives

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From CS Monitor and Small Business

The first report,written by SBA economist Jules Lichtenstein, looks at planning by small business owners for their own retirement.

The author's results offer substantial evidence for concern that business owners are not saving enough and that their retirement savings may be inadequate. 

Some of the findings:

• Individual-based (outside work) retirement account ownership, contribution activity and employment-based participation (at work) among business owners are low.
• IRA ownership rate for business owners is only about 36 percent, and only one-third of business owners with an IRA contributed for the 2005 tax year.
• Less than 2 percent of business owners own a Keogh plan. 
• Only about 18 percent of business owners participated in a 401(k)/Thrift plan.

Franchisee associations have a positive obligation to communicate with their members, the franchisees, and to the franchisor.

"Members [franchisee] should communicate frequently with the [association] board," advises Barber.

This type of approach helped the Denny's Franchisee Association members work with the franchisor in adding a gift card program, including a program where gift cards are sold by third-party vendors.

"The negotiation of the legal documents, along with the financial settlement issues associated with the program, were worked through carefully and thoroughly before the franchisees were asked to participate," Barber says.

"The entire franchise community accepted the program and benefited from the hours and expertise of DFA board members who worked diligently for the good of the brand."

Communication with all franchisees, whether or not they are members of the association, is one of the four main functions of a modern franchisee association.

The other three functions are: education, providing member benefits, and advocacy.

But, as Craig Barber states, "Members should expect the association to focus on brand and franchise system matters," adds Craig Barber, Chair of the Denny's Franchisee Association.

"[They should] not expect the association to be the advocate for specific individual franchise issues with the franchisor."