Why People are Rethinking Retirement and Franchising Instead
The past couple of years have upended long-held ideas about life and work.
Retirement. The word means different things to different people. For some, it's an idyllic lifestyle at the end of a long career. But for others, it's increasingly becoming a chance to hit refresh and try something new — without necessarily leaving the working world.
That second group is showing up in a big way. The U.S. Government's 2020-2021 Report on the Economic Well-Being of U.S. Households found that 45% of people retired because they reached normal retirement age, and an even larger percentage — 48% — retired because they wanted to do other things.
Where are many of them going? "We are seeing an increasing number of baby boomers looking strongly at food franchises," says Robin Gagnon, cofounder of We Sell Restaurants, a brokerage that specializes in food brands.
Gagnon says there are many reasons that food franchises appeal to an aging population.
"They are comfortable with the concepts and have spent decades as customers of franchise brands," she says. "Many have fond memories of a college job at a food franchise location. Most importantly, they see earnings on the books and a provable model as highly important when investing so close to actual retirement."
Roger Mellen adds another reason to that list: When a retiree's savings aren't enough to sustain their lifestyle, they want a reliable income-generator — which means they don't want the risk of launching
"Everybody said, 'Hey, save up a million dollars,' — which my wife and I did — 'and you can retire,'" says Mellen, who is 60. "It took our whole lives to save up that money. And then we said, 'Well, this ain't enough to retire.'"
When his wife Julia lost her job due to COVID, they decided to invest their money into a Marco's Pizza franchise. Both had some prior experience to lean on, as Roger was an executive chef on the Norwegian cruise line and his wife was the food and beverage director. Roger had even owned a restaurant during his first marriage. But since becoming a franchisee two and a half years ago, he's found that marketing a brand name is much easier with a franchise. "I love that your product's being advertised all across the country, on TV — people know the product," he says.
Now, Mellen runs five franchises throughout Florida with a business partner. He's noticed a difference in his business mentality as a 60-year-old versus running his own restaurant in his 30s.
"The difference is, when you're 35 you have children. So many expenses. I don't have children, now that they're grown up. I have grandkids," he says. "I can concentrate on my business. I don't have anything to hold me back."
And now that Mellen is in the franchise business, he's noticed something interesting: His franchise is inspiring other people his age to pursue their own franchise dreams.
"You wouldn't believe how many older people I have working for me who ask, 'Hey, how much does it cost to get one?'" he says. "They see the success, they see the great product, they see the wonderful customers. It's a great business to invest in. They see it themselves."
Related: 5 Steps to Gaining Financial Freedom