What would be the advantages and disadvantages of going into a franchise?
The big advantages are that you get a business system all set up for you. How to lay out your store, where to buy supplies, job application forms, all that and much more is already set up for you. You also receive training in how to operate a store successfully. Another advantage is name recognition – if you buy a Subway or something like that, people know the name automatically. Drawbacks are that you have to pay a franchise fee, you must also typically pay a percentage of sales as a fee and to contribute to national advertising. Also, you have much less control over how you run your business. As a Subway owner, you may not want to be open for breakfast but the corporation tells you that you must be open certain hours. I once looked at buying a fast food place in a shopping mall, and one of the costs I was going to have to pay was $5,000 for software for home delivery – who is going to order sandwiches for delivery from a shopping mall?
