A lot of people are looking forward to buy a franchise. Who would not be? We can read articles about successful franchise businesses that turned some individuals into overnight millionaires. And the best part, they did not even go through the difficult stage of business planning that is crucial to any business venture. When they bought their franchise, there were already established and proven methods of operating, and a ready set of system on how to run the entire business.
But with all those wonderful things we have read and heard of about franchising, we have to remember that there is always a flip side to everything. So here are the five disadvantages of franchising that you should know before joining the industry.
1. Having no full control of the business.
Since in franchising we are buying an already-running business and are just opening another store or branch, we would have to follow the established rules and ways of operating it. Depending on the agreement with our franchisor, having a franchise business can limit our creativity in the way we run the business and would have to strictly follow the directions of the franchisor when it comes to the products we are selling, services we are offering, and the business we are operating.
2. You can only be as good as the other franchisees.
When people look at a business, they see it as one entity. So when a customer has had a bad experience with one of the franchises, he will usually think bad of the whole business itself. The bad reputation of the other franchisees will affect our own franchise no matter how good we are in running our business.
3. There is sharing of profit.
Depending on the agreement, there is usually a sharing of profit when it comes to franchising. So whatever we reap from our business, we are not likely to get 100% of it and would need to share a certain percentage to the franchisor.
These are just a few things that we need to know about franchising. Should you need to know more, there is Fran Frog, a franchise consulting agency, who offers a no payment, no commitment consultation session for those who are interested in franchising a business. As a franchise consulting agency, Fran Frog aims to help budding businessmen decide on the best business to franchise to yield the most returns at the time they target to. With a franchise consulting agency, businessmen will not just know more about the franchising business, but will also be able to discern if the franchising business is really the most viable option for them. So call Fran Frog today at 1-800-388-2810 to set an appointment.