Read how H&R Block is pushing hard to attract immigrant franchisees.
When you think tax preparation, you probably think H&R Block. And for good reason.
Started in 1955 by two brothers in Kansas City, H&R Block has grown to be an international powerhouse in the tax-preparation business. About 4,000 franchise offices operated by 1,600 franchisees in the U.S. and overseas prepared more than 24 million tax returns worldwide in 2009.
Indeed, while the market for assisted tax preparation could experience flat growth in the near future, thanks to lower employment levels and more demand for online tax preparation solutions, H&R Block still is a significant force in the industry. “We’re the most widely known brand in the market,” says Doug Salaway, assistant vice president for acquisitions and development.
The company is making a big push in urban areas and looking to recruit immigrants in those locations.
The Company
Service
H&R Block specializes in face-to-face tax preparation, featuring extensively trained tax professionals.
Training
There’s a week-long orientation at corporate headquarters. Then franchisees work with their franchise district manager to make sure they’ve mastered the process. Computer-based training provides additional, ongoing help with business and tax information. There also are annual education requirements to ensure that H&R Block tax advisers are up-to-date in tax law changes.
Startup costs range from $26,427 to $84,094.
Immigrant-friendly Policies
While there are no specific policies, the company is making a big push in urban areas and looking to recruit immigrants in those locations. The company doesn’t know how many immigrant owners there are now, but “it’s one of the fastest-growing segments of new franchisees,” says Salaway. In addition, the company’s extensive support, including a dedicated field-management team and software tools for running the business, is also a plus for immigrant franchisees.
Funding
The company doesn’t provide any help with funding. (For information on fundraising, click here.)
What You’ll Need
Typically you lease space, which needs to be approved by the company. You’ll need computers and office furniture.
Startup Costs
They range from $26,427 to $84,094, depending on such factors as size of office and renovation expenses. Costs include rent, signage, equipment, insurance, furniture, and zoning fees.
Return on Investment
Salaway says the company can’t provide information on future performance.
“We love to have entrepreneurs, people who want to run and grow a business,” says Salaway.
What They’re Looking for in Prospective Franchisees
Previous tax background is helpful, but not required. More important, “we love to have entrepreneurs, people who want to run and grow a business,” says Salaway. The best thing is if you’ve headed a firm before. But they also look for other evidence of entrepreneurial spirit, from running a newspaper route to being in charge of a club at college. In addition, according to Salaway, franchisees should be active members of the community in which they would operate. The company is also looking for people with existing tax-preparation businesses who might want to turn their practice into an H&R Block franchise.
“You…need a flair for marketing, especially in the tax-preparation market.”
Tips for the Immigrant Buyer
It’s important to find a franchise with a proven system and extensive technical and business-management support provided to franchisees, says Salaway. But you also need a flair for marketing, especially in the tax-preparation market.
“Our business is very competitive, and you have to able to distinguish your venture from all the others,” says Salaway.
At H&R Block, thanks to the nature of the business, there are other considerations, as well, such as an interest in keeping up with regulatory changes. “That’s why it’s important to ally yourself with a franchise that has a track record,” says Salaway. “It gives you an increased chance of success.”
