British Plumbers Lose When Franchisor Goes Under

British franchisors provide revenue expectations to franchise candidates and those expectations before buying look grand indeed. Here's a story of a plumber who bought a franchise to not only find that his revenues were considerably lower than he was led to believe but also that his franchisor went under shortly after buying. According to the investigating Insolvency Service, the franchise owners were seriously misled, with store revenue projections falling short of actuals by some 55 to 86 per cent.

A U.K. franchise attorney (solicitor) thinks one solution is to have franchisors provide a range of scenarios to franchisees. He also advise buyers that if the numbers are too unbelievable, then it IS unbelievable.

'If they are saying you are going to make £300,000 in your first year from a £30,000 investment, you probably shouldn't believe them.' Franchising solicitor David Bigmore, based in Gresford, north-east Wales, says that a well-established business should be able to produce a range of realistic turnover predictions. [The Daily Mail via HighBeam]