There are of course many reasons to buy a franchise and we have all heard them. Such as the high failure rates of small business, Corporate Life Blues and a successful proven business model. Yes, all these are indeed considerations and fairly good reasons for buying a franchise rather that having a J-O-B or starting your own business from scratch and learning everything the hard way on your own dollar and investment. Now then lets talk about why you should not buy a franchise, for instance franchises can be very restrictive. You must buy certain things from the franchisor and only sell approved products and provide approved services as per the Confidential Operations Manual and the UFOC or Uniform Franchise Offering Circular, which includes the franchise agreement. Also you must run nearly every aspect of your business and maintain the standards set by the Franchisor. Good well all that makes sense right? Sure it does, but if you are an entrepreneur, you may not like all these restrictions so much. Indeed the franchisor also has a marketing plan, which may not be tested in your regional demographics or area. You will also have to pay royalties and a huge upfront franchise fee. You will have Franchisor staff come to visit and tell you what to do. They may tell you to re-design your store and as per the agreement you must comply costing you money. These are just 7 of the most common complaints of those who have bought franchises. Most franchisees are overall happy or satisfied with their franchises, but not all and there are some horror stories out there, so consider all this in 2006. |
