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Absentee Ownership Franchise Offerings

Few businesses can be successfully operated remotely - even in hair styling

The mind of the scammer is always fertile. Right now, especially in the hair care/barber shop/salon business, folks are being told that the franchise is perfect for those who have other things to do and don’t want to actually work in the business full time. This is rarely true, but it is a strong selling point to many people. 

With very few exceptions, there aren’t any small consumer type businesses where you are dealing with the public one person at a time that can be successfully operated from afar.

I have become acutely aware of this due to a haircut franchise matter that has come to me in which the franchisee has his residence and other business a few hundred miles away from this franchise location.  

The franchisor does not have that many franchisees open and operating, and had no basis whatsoever to suggest that this could be a successful operation in that mode. It is my understanding that there are no other absentee ownership franchises in this system, so no one has any track record operating this franchise as an absentee owner using only a manager to be in charge.          

The franchise agreement does not require full time engagement by the franchise owner. It speaks of “best efforts”. This enables the absentee owner sales pitch.

FORGETABOUTIT! 

If you or your client is offered such a deal, at least insist on vetting all the franchisees who are actually operating as absentee owners. It may well be that someone who has a substantial history as the operator of hair care/beauty salons could operate many shops, stopping in every day or every other day. But if you lack that history yourself, don’t even think of trying it. And if you did have that kind of experience, you wouldn’t be buying a franchise in the first place unless you were not smarter than a 5th grader.          

Like almost all these really bozo deals, this is a fairly new franchisor.          

Heads up, folks!

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