Like It Or Not: Franchising Comes With No Guarantees. Accept It Before You Buy!

One thing you need to understand before you buy a franchise: It never, ever comes with guarantees.

Do you know of any business methodology that does?

Systems make franchises work

Franchising isn’t a business. It’s a method of distributing products and services. The method is defined and supported by a system. How well the franchise will perform depends first and foremost on the quality of the system.

Franchisees make systems work

The next most importance factor is the franchisee’s desire, ability and willingness to follow the system. A quality system in the hands of a dedicated franchisee usually spells success.

But there are no guarantees

However, there are other issues that must be considered when you buy a franchise–issues that you cannot control:

1. The economy. Had we only known in 2006 what we’d face in 2008 and 2009 — most of us–franchisors and franchisees–would have made different decisions about our franchises.
2. The market. Interests and demands change. Suddenly, there’s no market for your product or service.
3. Changes at the corporate office. The new management team isn’t nearly as good as the old management team–they manage, but they don’t lead. The new ownership isn’t nearly as vested in the franchisees as was the founder–they make promises and don’t deliver. When changes occur at the corporate office, they may negatively impact your business, or at least your relationship with the franchisor.

Any one or a combination of these issues can turn a thriving, satisfying, profit-producing franchise (or business) into a disaster.

Can you accept this risk?

That’s a risk you must be prepared to accept before you buy a franchise.

If you can’t or don’t want to, here’s my best advice–and I suggest you take it: Keep your job! . . . Or get one. A job may not be satisfying and it may not pay enough money — but if you’ve got one, or can get one, it’s safer than buying and operating a franchise.

Most of you who are reading this blog won’t be sidelined by this advice. You’re not going to keep your job or get another one. You’ve done that and it didn’t work. You’re going to buy a franchise–but now you know that risk is inherent in the methodology.

Accept it!

Photo image by: Flattop

Categorised in: Buy a Franchise

This post was written by Dr. John Hayes