Ten Reasons Not To Buy A Franchise

I doubt if this list will show up on the front page of franchise media sites. Here are the top 5 of 10 reasons NOT TO BUY a franchise, according to Forbes. (The list provides a reality check before buying.)

1. Questionable profitability: Most franchisers do not provide much information to potential franchisees regarding earnings possibilities, making it difficult to assess how lucrative the venture is.
2. High start-up costs: It can take years to recoup expenses connected with getting your franchise off the ground.
3. Encroachment: You just spent thousands of dollars opening your own GasMart station when another GasMart opens across the street.
4. Lack of legal recourse: There is little legal recourse that a franchisee can take if wronged by the franchiser.
5. Unfair termination: The slightest impropriety, such as being late on a royalty payment or violating a standard operating procedure, can be cause for the franchiser to terminate the franchise agreement.