What are the benefits of owning an owner absentee business?
Are you considering starting the best owner absentee business? Before you embark on this venture or during the planning stages, it's crucial to comprehend the advantages this type of business can offer. In essence, the key distinction between owning the best owner absentee business and a conventional one is that the owner doesn't have to be present all day for its management. The best owner absentee business is one where the owner oversees and runs the operation without handling day-to-day tasks, dedicating their time to more significant matters like strategic planning, marketing, and activities that will drive the success of their business.
Here are some reasons to consider owning the best owner absentee business:
1. You already own a business and are looking to increase your annual net income.
2. You have a stable job with excellent benefits and a generous salary, but you also want to own a business that can be passed down to your children one day.
3. Your current job pays well but lacks a retirement plan.
4. You are retired and seeking to own a business without the necessity of working in it full-time.
5. You aim to purchase, develop, and eventually sell it for a profit.
Tips and advice on running a business as an absentee owner
You've discovered a promising business opportunity. The financials check out, and you're already envisioning the increased earnings without having to exert much effort. As appealing as that may be, I'm here to emphasize that if you lack a well-thought-out plan for effectively managing an owner absentee business, your aspirations of becoming the owner of a successful conglomerate may fall short quicker than you expect. Let's discuss the smart approach to running your business or business. In this section, I'll outline a five-step process that I've personally found to be highly effective.
3 Step guide to running multiple businesses
Step 1: Understanding the industry
There are several critical considerations when purchasing a business. Sometimes, it's wiser to gain a deep understanding of the industry you're about to enter before making an investment. I have a personal experience to share – I started a recycling business quite a while ago. A friend offered to provide financial backing while managing the operations, given his extensive knowledge of the business, while I had only a basic understanding.
To cut a long story short, even though the profits were excellent and the business was thriving, my friend received a lucrative offer out of state for a better opportunity. He didn't give me much time to devise a plan, so I had to hurriedly find a replacement for my job and take over the recycling business. I had no prior experience in running such an operation, and it took me two months to get a grip on things.
The key takeaway from this is Step 1: Do your homework thoroughly. Run the business yourself initially before depending on others. This way, even if a situation arises where you need to hire and train someone to take over, the transition will be far less chaotic for you..check out →what entrepreneurs must assume when starting a business
Step 2: Starting and ending meetings:
When I mention "reports," I'm not necessarily referring to a lengthy 20-page document. It could be something as simple as a text message, a phone call, or even an email. The important thing is to communicate with your employees and let them know that even when I'm not physically present, I'm still here to support them.
When your employees witness effective leadership, they are more motivated to excel because their livelihoods depend on it. Trust me, many employees are genuinely invested in the company's success, as a slowdown in the company's performance puts their jobs at risk. Here are some examples of what should be covered in a meeting:
Starting shift meetings:
1. Discuss the daily route for pick-ups and drop-offs.
2. Sharing information about new customers.
3. Providing updates on any issues or follow-ups related to customers from the previous day.
4. Addressing any concerns or questions employees may have.
5. Actively seeking input and advice from employees.
Ending shift meetings:
1. Daily route completion sheets:
2. Reporting on any issues, returns, or customer dissatisfaction.
3. Noting and reporting any problems with trucks, software, or tickets.
4. Checking in with employees to see if they encountered any work-related issues.
Step 3: project management software
Running an owner absentee business requires you to strategize on ways to optimize your time. Imagine owning five owner absentee businesses – your initial reaction might be, "How can I manage that?" Well, you can do it, and it all comes down to the tools you use for effective communication with vendors, employees, and more. Here are some tools to consider:
Asana: This tool is excellent for task assignment to employees. They can easily see their daily tasks, mark them as completed, and upload associated worksheets. You'll receive notifications in real time.
Breezeworks: If you're operating a business in waste management, delivery, or services, Breezeworks is a cost-effective solution. It allows you to schedule routes daily, weekly, or monthly.
Zoho: Zoho is a well-known software used by over 3 million businesses. It's versatile and can be employed in various industries, including construction, landscaping, website development, and more. You can use Zoho to manage multiple businesses efficiently.
Linxup.com: Linxup offers GPS tracking devices for trucks, cargo vans, and any vehicles in your fleet. These devices allow you to monitor your vehicles' movements, helping you track when employees start and finish their shifts, ultimately ensuring the smooth operation of your business.
5 owner absentee businesses Ideas
The goal of owning an owner absentee business is to identify businesses that demand minimal effort and management. Here are my top six owner-absentee business recommendations:
Vending Machines: Vending machines rank among the most popular owner-absentee businesses. They are simple to set up, demand minimal maintenance, and offer a high-profit margin.
Vending machine routes are an excellent source of passive income, meaning you often don't need to be actively involved to make money. Most vending machines can be placed in locations that aren't open 24/7, so you won't need to be present around the clock. The beauty of owning a vending machine is the consistent income it provides, requiring little attention. Your primary responsibilities in this owner-absentee business include:
Actively seeking more vending machine locations.
Ensuring that vending machines are consistently well-stocked.
Addressing any issues that arise with vending machines.
FedEx Routes: FedEx is a company that has revolutionized the shipping industry, making it possible for businesses to send items to their customers without concerns about delays or damage. FedEx routes for sale offer a range of services and products, all designed to enhance shipping efficiency and convenience.
Purchasing a FedEx route business is ideal for an owner-absentee business. You hire the right employees to manage the daily routes. This type of business also grants you the flexibility to set your own hours, allowing you to spend time with family and friends without worrying about missing work hours, as your employees can take over at any time of the day or night, depending on the immediate needs.
This owner-absentee business will require the following from you or a manager:
Managing daily delivery routes.
Setting up daily routes for drivers.
Ensuring that drivers are on schedule.
Vehicle tracking.
Collecting payments.
Bread Routes: If you're seeking the best owner-absentee business idea, bread routes are among the most common and profitable options. They offer a great way to generate passive income and require minimal capital investment from you.
Here are some of the benefits of owning a bread route business:
Passive Income: The business concept is straightforward. Let's say you acquire an established bread route with 75 customers, divided among two drivers using a box truck. You can take customer orders daily over the phone, forward these orders to the bread bakery, and then send the route list to the drivers. If you can handle this part, you'll save money by not needing to hire someone to manage daily orders.
Low Risk: Bread routes are low-risk ventures since your primary investments are in the vehicles. Unlike other owner-absentee businesses, you don't need to worry about employee turnover or customer complaints because you're not directly involved in the day-to-day operations of the business.
This owner absentee business will require the following tasks:
Managing daily bread orders.
Forwarding orders to the bakers.
Sending routes to the drivers.
Collecting outstanding balances from customers on a weekly basis.
Beverage Distribution Business: When considering the beverage distribution business, you might initially think, "I need a massive warehouse, a forklift, and a large workforce. This sounds like a complex investment." However, you'd be mistaken. It's one of the simplest owner-absentee businesses you can own. You can effectively manage this business from anywhere in the country, provided you have an internet connection.
Let me break it down further on how beverage distribution works. There are two options. The first involves owning a warehouse and purchasing beverages in large quantities, essentially operating a trailer-sized operation that requires your full attention. But that's not your goal, right? You want to earn money without the hassle of managing such an operation, which brings us to the second approach to owning a beverage distribution business.
You can strike a deal with a reputable wholesaler who already has the warehouse space. Inform them that you have a committed customer base ready to purchase beverages from you and that you'd like to source your beverages directly from their warehouse. While the wholesaler might charge a slightly higher rate, you'll still turn a profit.
This owner-absentee business will require the following from you or a manager:
Managing customer orders.
Forwarding customer orders to the beverage wholesaler.
Preparing route sheets.
Handling financial aspects like payroll, vendor payments, and more.
Transportation Businesses: Buying Transportation businesses makes an excellent choice for an owner absentee business. These ventures are suitable for entrepreneurs, regardless of their experience or background, and offer various benefits, including:
Low Startup Costs: Most transportation businesses don't require significant equipment investments. Expensive tools or machinery aren't needed to get started. You also don't need a large space; transportation businesses can operate out of your home or garage if necessary. If you're considering cargo vans or even larger options like tractor trailers, you can always rent parking lots for them.
One-Person Operation: Most transportation services can be effectively operated by a single person, which minimizes the need for multiple employees. This simplifies payroll management.
Flexibility: A transportation service can run 24/7, providing considerable flexibility in terms of when you choose to work and how much time you allocate to its management each day. This also means that individuals with full-time jobs can successfully run a transportation service on the side.
Expansion: Expanding a transportation business is relatively straightforward. Once you can manage one vehicle, you can gradually add more to your fleet.
This owner-absentee business will require the following from you or a manager:
Setting up routes.
Managing vehicle maintenance.
Handling payroll.
Pros and cons of owning an owner absentee business
If you're contemplating the purchase of an owner absentee business, there are several factors to consider. However, here are some important ones you should initially focus on:
Find a Niche You're Passionate About: Even if you're buying the business as an owner absentee, you should have some level of interest and knowledge in the industry. Being passionate allows you to provide valuable insights and feedback. While some people acquire a business solely based on financials, having industry knowledge is crucial.
Have Extra Funds for Contingencies: It's essential to have additional funds on hand after acquiring the business. Emergencies and upgrades can happen unexpectedly. For instance, imagine you purchase a delivery route business with just one truck, and shortly after, the transmission fails. It's wise to keep at least 25% of the acquisition cost in reserve. So, if the business costs $100,000, you should have $15,000 to $25,000 in cash or credit available until the business generates enough cash flow to build its savings.
Trustworthy Personnel: When you find a route or any business to purchase, consider running it yourself for the initial 3-6 months. After gaining valuable insights, you can then hire someone to manage it similarly to how you did. This hands-on experience will enable you to better oversee the business. Simply buying a business and handing it over without any knowledge or oversight is often a recipe for disaster.
Pros of owning an owner absentee business
When you purchase an owner absentee business, you're acquiring an established, profitable enterprise that's been in operation for some time. Such businesses are already running smoothly, with a loyal customer base in place. This established reputation makes it easier to initiate and fulfill orders, as people are familiar with your company.
Furthermore, the success of owner absentee businesses is a testament to their inherent profitability. Investing in an owner absentee business for sale offers numerous advantages, including:
Passive Income: These businesses can generate income without requiring your constant, hands-on involvement.
Stress-Free Income: The established operations reduce the stress associated with starting a business from scratch.
Growing Your Assets: Owner absentee businesses can be a path to increasing your financial assets.
Opening Doors for Acquisitions: Proficiency in managing your first owner absentee business can open opportunities to acquire and oversee additional businesses.
Hiring Friends and Family: You have the flexibility to involve trusted friends and family members in the business.
Retirement: As the business generates passive income, it can contribute to your retirement plans.
Remote Management: You can manage the business from anywhere, providing more flexibility in how you choose to work and spend your time.
Cons of owning an owner absentee business
Things to watch out for when buying or starting an owner absentee business.
While there are many benefits to starting an owner absentee business for sale, it's important to be aware of the potential red flags or drawbacks as well.
The initial investment can be substantial.
You may acquire an owner absentee business with poor cash flow.
The business might not align with your skills or personality, potentially leading to workplace stress and dissatisfaction.
There could be undisclosed legal issues, such as customer lawsuits, which may emerge after your purchase.
Owner-absentee businesses often experience higher employee turnover, making training and hiring costs more challenging, potentially impacting profit-sharing distributions.
Seasonal fluctuations may lead to peak periods in the summer but slow business in the winter.
Beware of businesses that may seem like owner-absentee operations but require more involvement than expected.
Challenges may arise if employees fail to arrive on time or show up at all.
More stuff to consider when buying an owner absentee business for sale
If you want to make the most of your time and have a successful owner-absentee business for sale, here are some more tips:
Effective Time Management: It's essential to have a well-structured plan for each day and adhere to it. Being caught off-guard by unexpected issues in your life or business can disrupt your operations.
Build the Right Team: Surround yourself with a competent team capable of maintaining high-quality standards and customer satisfaction. Your team should be equipped to swiftly address customer issues and resolve them efficiently, minimizing the need for multiple meetings or involvement from higher-ups.
Discipline as an Individual and Team Player: Discipline is crucial not only at an individual level but also within a team, especially when working within budget constraints.
When browsing the best owner absentee business to buy and running them it demands determination and commitment. Consider whether you have the necessary dedication to succeed in this venture. Running a business requires hard work, and there's no such thing as a completely owner-absent business. Just like having multiple children, you must be equally invested in each one. Success in entrepreneurship requires giving your best, mentally and emotionally, even if you don't need to be physically present.
In summary, the first step is to find an owner absentee business that aligns with your passion and industry knowledge, rather than solely focusing on the financial aspects.
Next, it's important to trust your staff to perform their jobs without constant supervision. Micromanaging can undermine productivity and morale.
Third, having the right tools and systems in place is essential to streamline the operation of your owner absentee businesses.
Lastly, consider hiring a capable manager with experience in both general management and your specific industry. Strong leadership skills and the ability to work independently are also important traits for this role.
Disclaimer: The information provided in this article is for general informational purposes only and should not be considered legal advice. The laws and regulations regarding business licenses may vary from state to state and are subject to change. It is important to contact your local state office to determine which licenses are required for any specific businesses. Additionally, please note that this article contains affiliate links and we may earn a commission from our affiliate partners or amazon links. If you are considering starting a business, it is recommended that you seek the advice of a qualified lawyer, business broker, or professional in your area. The information provided in this article is not a substitute for professional advice and should not be relied upon as such.