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Log In / Register | May 23, 2012

A Franchisee's Warning About Owning A Business

Posted Tue, 2007/08/28 - 18:38 by therocket

Not Everyone Is Cut Out for Owning a Business or Franchise

This is part of an email sent to me by someone who took the plunge into business ownership as a franchisee.  Seven day weeks and thousands of dollars later the excitement has been replaced by the realization that the American dream has become more difficult than ever to acheive.  

"I'll tell you, it seems that the boss hasn't been eliminated, just changed.  The government, franchisor, the landlord, and all the vendors are who I work for now.  Every agreement is weighted in favor of someone else.  All the rules and regulations forced on us cost money and don't do anything to bring in business.  The franchisor, the government, the landlord, and vendors can change the rules or raise my cost of doing business but if I'm not following those agreements to the letter my franchise agreement can be terminated or we can be closed down or lose access to the products we need to stay open."

Why Franchisee Control of Ad Budgets Is So Important

Posted Mon, 2007/06/25 - 17:40 by therocket

Here's a perfect example of why an ad co-op run by franchisees should be one of the criteria every potential investor looks for when buying into a franchise system:

Quiznos has taken millions of dollars in ad fees, a great sandwich in the Baja Chicken, and the decision to go cold turkey on couponing and come up with an advertisement campaign that has been on network tv much less than 100 times in the past two weeks.  Instead, Q loaded up on late night time slots on second tier cable staples like USA, SciFi, and ESPN News.  Turn on ECW and see Q's latest offering - turn on the US Open - Tiger Woods is front and center but Q is a no-show.

What has that meant for Q franchisees?  Falling sales across the country.  No matter what the marketers tell you there is nothing more effective than running good ads on prime-time programming and major sporting events on the major networks.  And for a high-end QSR like Q it's a guarantee to get the most number of looks from those who will pay a premium price for a premium sub.  We can sit and debate the pluses and minues of the "Wrong Way" Sub campaign but the current schedule gives Q no way to guage its impact.

To Buy Or Not To Buy

Posted Fri, 2006/12/29 - 21:51 by therocket

This is for those of you still looking for a franchise.  No matter how much due diligence you've done it's never enough.  You will learn alot more about the company after you pay the franchise fee than you want -  all the warts, problems, and negatives.  When it looks good be aware it's not as good as you think; when it looks bad, it's worse. 

Next - franchisors see you as free money and only as free money.  Coupons that give away food, gift cards with outrageous fees, and giveaway promotions are designed to benefit everyone but the guy who owns the store.  Believe it.  When you see a bogo coupon or an offer that seems too good to be true just be aware that the only thing the franchisor contributed was the "good" idea.