Rabu, 20 Juni 2012

What Are the Disadvantages of Franchising?

Forget about starting up an all new business. You can easily generate income by opting for a new franchise. There are numerous franchise options that are available on and off the web too. It is therefore your choice to come up with the best franchise option. Franchising is thought of as a business model that has great potential. But, it is very important to understand the upside and the downside of any kind of a business you wish to undertake. Just as there are two sides to a given coin, there are also the good and bad about going in for franchising. In this article we are going to delve deep into what are the disadvantages of franchising.

No doubt franchising has a whole lot of benefits as it comes along with a whole lot of proven ideas and most importantly huge brand names. But, the franchisor may still run the entire show which you may not appreciate at all times. It is only after you enter into the business that you will be fully able to arrive at the costs of the business and by that time it would be too late. Yes, the franchise costs may be really high than you have expected for you will have to think about the initial costs while buying the franchise, the setting up costs and buying the stock from the franchisor.

What are the disadvantages of franchising? You need to assess them from the franchisor perspective as well as from the franchisee perspective. There is always the risk of getting exposed to liability for the various acts, omissions and negligence of the franchisor that may put the franchisee also into risk. One has to understand if the franchise is a company owned unit or an independent franchise unit.

To state in a nutshell, franchising is not an all perfect business opportunity. It is also not a completely problem free solution either. However, it gives a great opportunity to expand on other's thoughts and business models. If you are envisioning a franchising program, it is essential that you consider both advantages as well as disadvantages too. You should remember one thing that there is no best franchise that will give you a perfect 10 on 10 every time. However, let not the negatives put off the new option of franchising for you because it is found to be highly useful and effective method for any kind of business expansion. Only thing that is needed is proper development, analysis and planning.

Once you have weighed the pros and cons you divert your efforts in the direction of finding the best franchise business as well as the sales process that will give you good results.

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