Predictability of Demand
The old adage still applies: nothing is constant except “death and taxes.” Investors looking for business startup or franchise opportunities can be assured of predictable seasonal demand during April filing season and other milestones (extension filings, for example) throughout the year. While every business has somewhat predictable rhythms (think of a gift shop in a resort town or an ice cream store during the winter months), none are quite so reliable as being able to plan for Q1 volume leading up to April 15.
Freedom and Flexibility
The same predictability with client demand also gives tax service franchisees predictable downtime during the year; while every business requires some level of attention year ‘round, many people who invest in tax service businesses know that during certain times of the year, they can travel, spend more time with their families or pursue other interests with the knowledge that the business can safely stay on autopilot while they enjoy themselves elsewhere. This makes tax services an extremely attractive option for investors who don’t want to become slaves to their business and be up to their necks in operational concerns on any given day.
Support from the Franchisee Community
Every system has an interest in franchisee success; in the tax service model where the primary metric is number of returns processed a year, it is simpler to collaborate with fellow franchisees to move the needle. As operational burdens aren’t as heavy as, for instance, a food franchise, new franchisees can quickly tap into local and national networks of more established franchisees to improve their results quickly. The owner’s “dashboard” of business performance is comparatively simpler to read—and getting help in improvement is much more accessible.
Low Barrier to Entry
Thinking about opening your own McDonald’s? According to their own website, that conversation begins with your having a cool $500,000 in non-borrowed “personal resources.” Depending on your location’s needs, that price goes up if you’re factoring in construction, remodeling, etc.
• Many franchises (such as restaurants) prefer or require that franchisees have some experience in restaurant management. Tax service franchises, by comparison, can be started up by a franchisee with no previous tax experience.
• From restaurants to dog washing to car repair, franchises exist for almost every kind of business you can think of. But with those models comes a large operational investment in equipment, supplies, training and constant maintenance and troubleshooting. Tax services are more or less run with desks and computers, making them an extremely attractive option for a franchisee who wants to get in the game without investing in lots of specialized machinery, equipment and training.