Tuesday, January 31, 2012

The Folly of Buying a Franchise

Why bother to buy a franchise?

Why should someone pay for a company name and expertise when they can probably duplicate the same entity at no franchising cost?

There are some questions to ask yourself about the possibility and logic of a franchised business.

Whether it is easily duplicated or entered into by a competitor. Or: It does not have a highly recognized brand name or special management expertise to offer.

The royalty you pay on sales, that cover whatever management training and materials you may get, will probably represent about half your net earnings.(See Earl J Weinreb NewsHole® comments.)

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