In order to secure their financial future, athletes should not just sit around doing nothing after retirement. An easy way for athletes to gain a secure economic well being is to franchise, which is getting involved with companies and investing and supporting the expansion of the company. Using the article from entrepreneur.com, one of the leading finance websites on the internet, “Why More Pro Athletes are Scoring Franchises after Sports Fame,” I will argue that franchising is one of the most productive and effective job opportunities that an athlete can do after retirement.
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| SOURCE: entrepreneur.com |
Jamal Mashburn considers himself an “anomaly” Mashburn, the 12 year NBA veteran from 1990s and early 2000s, always had a fixation on the briefcase. To Mashburn, the briefcase was a symbol of “information and knowledge”. Being one fo the few athletes who realized that his career would be short and in risk of being stripped away by injuries, Mashburn began to become involved in franchising. Even during his career Mashburn collaborated with a group of investors and picked out businesses to buy franchises instead of blowing his money on fancy cars and houses like other athletes. “Now, six years after his last layup, Mashburn has a briefcase full of contracts for 37 Papa John’s, 34 Outback Steakhouses, three Dunkin’ Donuts, and the largest Toyota dealership in Kentucky.” Mashburn established himself as an investor and a franchiser early on in his career and now he has successfully invested in over 70 businesses.
Pro athletes are very lucrative to franchisors. Athletes will have a “large pool of investment cash” and often have a “network of friends that are in the same position.” The athletes provide a marketing buzz. If an athlete were to invest in a business, the business would most likely receive increases in income solely due to the name of the athlete associated with it. Sports are such a huge deal in the United States that people will be willing to buy products or services from a company that has relation to their favorite athlete or an athlete on their hometown team.
Compare franchising to starting your own business. Athletes do not have the skills required to start their own businesses. As I pointed out in my previous blog post, many athletes will opt not to receive a full education. Not having a college degree will only harm athletes if they attempt to open up their own business. They do not know how to handle the markets, budget correctly, or make the right business moves. Sometimes this strategy does work out, for example Ditka’s Steakhouse or the George Foreman Lean Mean Grilling Machine. Yet, the risks are far greater than the rewards in this case. If a business fails, the athlete has absolutely nothing left. Franchising minimizes the risk as well as teaches athlete along the way what it is like to be a successful investor. By working with a group of investors, athletes can receive guidance under experts and they can broaden their investments to many brands and products.
However, franchising isn’t as easy as it sounds. Athletes have a humility problem. I think this starts down all the way through high school. The players are the best in their school and they think they are the best out of their team. They were far greater than all the other players so they develop this sense of dominance over others. This can transfer all the way to the pros and the way that athletes are essentially praised by the fans doesn’t help to solve this problem. So naturally, when athletes will try to go into the corporate world, they seek management positions. At this point in their life, they have never been in a corporate setting. They look to the success they had in sports and automatically think it can transfer into the business world. These careers are two entirely different beasts. The best thing for athletes to do, if they wish to become involved in franchising, is to network. Find people who can help them and mentor them. They need to set their hubris aside and use the opportunity to gain experience and grow.
Franchising provides a safe and efficient way for an athlete to provide for themselves after retirement. Through training and growth, athletes can become experts in the corporate world. Franchising eliminates the risks that business startups come with and franchising will also provide the athlete with guidance and mentoring about the corporate world that they might have missed by going into the draft.
Future Research: Are athletes paid too much? Would a lower salary help them keep track of their money more effectively?
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