Franchising works well for lots of people.
The chances of success are
much higher than among non-franchise start-ups. And you can see exactly
what you're getting into.
But we aren't sold on franchises. Here's why:
1. If it doesn't have your name on the door, it isn't your business. You want to set up your own business so you can be you own boss. But franchisees have to use pre-set methods and operate in pre-set geographical areas. In short, if you buy a franchise you'll be saddled with bosses again.
2. Twelve months down the line, you'll feel differently. You'll know how to run your own business. And self-employment won't be scary any more. But you won't be able to change or develop the business. Because, as we said, the franchise company won't let you. So, before you buy a franchise, think how you'll feel in a year's time.
3. It'll cost you. There are three areas of expense. First, there's the start-up fee. The franchisor will tell you that it pays for the training, the systems and the materials. That's true, up to a point. But if you didn't have to pay for it, that cash could see you through the first 6-12 months of your start-up, when you have few customers.
4. Then there's the monthly fees you pay the franchisor. Normally, this is a percentage of your income. The franchisor will tell you it pays for advertising and central support. That's true, to an extent. But it you were on your own, you could pocket those fees. And if you get to be successful, you may grow to resent the monthly fees.
5. You'll have to buy your materials from the franchisor. And when you see that you can buy it cheaper down the road, you'll get frustrated.
6. Is carpet cleaning that exciting? Do you want a lifetime of re-filling vending machines? Do you want to flip burgers all your life? Too many franchises are unexciting. And they probably don't align with your passion in life. So if you love travel, set up your own personally-guided tour business. If you love flowers, set up your own floral arrangements business. Don't buy a franchise unless you're in love with the concept.