Business Zone

By Karen E. Klein

It’s a tricky transition to go from mom-and-pop retailer to branded franchise operation—one that requires costly professional help.It certainly helps to have experience from both sides of the franchisor-franchisee relationship, says Solomon Choi, 30-year-old president of 16 Handles frozen yogurt shop in New York’s East Village. He’s drawing on experience working in his parents’ franchise restaurants as he starts the franchising process himself.He spoke recently to Smart Answers columnist Karen E. Klein; edited excerpts of their conversation follow.

Karen E. Klein: How did you get started as an entrepreneur?

Solomon Choi: I grew up in Southern California, where my parents were franchisee owners of a couple of Japanese seafood buffet restaurants called Todai. While I was at USC studying business, on weekends I worked for them as a busboy and then as a server. After I graduated as a marketing major and worked in Corporate America for a few years, my father reached out to me to help him run his restaurant in San Diego, where there was a lot of competition from the hotels. We turned around that business and sold it in 2005. During that time I saw how a business is run and how you report to franchise owners. Read the rest of this entry »

Forewarn would-be employees about your background checks, verify résumé facts, check references—and provide a way to report unethical behavior anonymously

Small employers suffer the most the when it comes to business fraud. Those with fewer than 1,000 employees lose an average of $150,000 per fraud case, while larger companies lose $71,000, according to the Association of Certified Fraud Examiners. Ken Springer, a former special agent in the FBI, has investigated hundreds of fraud cases in small companies over the past 25 years. Springer, 56, is founder and president of Corporate Resolutions, a New York investigations and consulting firm that examines, among other things, misappropriation of assets, intellectual property theft, and employee backgrounds for businesses here and overseas. He spoke with Bloomberg Businessweek‘s Lauren Hatch about the types of fraud that are flourishing in small businesses and what management can do to prevent financial loss. Edited excerpts of their conversation follow.

Lauren Hatch: What is the most prevalent type of fraud affecting small businesses today?

Ken Springer: I think the biggest fraud we see is check tampering, at least, that’s probably the biggest way people get hurt. Read the rest of this entry »