The Cost of Buying a Franchise

You might think it less risky to buy a franchise business. But if you look at most successful companies and how the franchise started, they took great risks just so they can do well. So why rely on a proven formula as a business model to create your own? Here are the reasons why the franchise business is a thing of the past, the reasons that make you go in a society pure and creative designed by you.

Starting a franchise business can be costly. Buying a franchise, especially one that was successful, can be very expensive because franchisors are banking on the idea that if you buy their business, you are definitely a lot of money. They offer everything you need for supplies and training.
Not all business models are sold as franchises sold because they are successful. Some companies sell franchises because their businesses succeed. They sell to make money for people who want to make money quickly.
Your franchisor has control over your deductible. Your activities tend to follow your franchisor. You can not franchise business to meet the needs of your local market.


After the cost of buying a franchise, you still take into account other payable to your franchisor. You have a monthly fee to pay royalties. Apart from royalty, a fraction of your income should also consider your franchisor.
The reputation of a franchise can make or break the reputation of others. If a franchise in a city close to providing services bad, your reputation will be affected.
The parent companies are not always taking care of their franchises. Some companies let your mother run your own franchise, after they help you start your franchise business. Their only link with the fees they receive from you.
Just because a franchise model is supposed to have a proven formula, it will sell in your area. It may not suit the taste of the potential market for the franchise location. It can be sold in a nearby town, but there is no guarantee for sale in your area.
The growth of your franchise is limited by your franchisor. You can not add anything to your product line just to suggestions that your client needs. You can not develop your own. Your franchisor is the only one who can make your products and change business model.
Creativity is in most start-ups, including Internet companies, are made by entrepreneurs who have only limited by their imagination. People nowadays like to experience new things, creativity and new businesses to attract customers.
More people go for niche products. A franchise business offers products that have become over-plant, usually. More people out of their way to find companies that offer products that are unique, focusing on specific niches to offer. People who do not give too much attention to brands. Instead, they focused on getting products that are specialized for their specific needs.

Thursday, September 29th, 2011 Business Opportunity

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