What Are Some Advantages and Disadvantages to Franchising?

A Video FAQ with Mark A. Williams.

There are a lot of advantages and disadvantages to franchising. Some of the advantages include that you are buying a box, something that has already been proven–a strategy, a brand, a system. You can buy into a franchise with little or no experience in that area and have a successful business because you are trading on the brand that has already been created. Now, because of that the franchisor wants some things from you. They are going to want a fee up front, they are going to want royalty payments, they are going to restrict you to only operating the business the way that they want you to. There is usually very little flexibility to go outside of their system or even to sell other products or services on the side. Once your franchise is over, once it is terminated, you usually have to stop doing that business. So once you get into a franchise, you usually have to think about staying in it for the rest of your career or selling the business.

© 2014 Parsonage Vandenack Williams LLC

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