Canada's Misleading Franchise Success Rate Claims

Lorraine McLachlan, president and CEO of the Canadian Franchise Association, is claiming that franchise businesses are four times more likely to succeed.

McLachlan said that a recent study released by BMO indicated that nearly four times as many franchises succeed compared to independent small business.

"When you go into an established system, which is the hallmark of a franchise, the probability of success is obviously incrementally increased," McLachlan said. "The fact that there are more than a couple of locations currently operating using that brand, using that system, suggests that it's not a flash in the pan and that there is some history that it will succeed."

... "in economic times such as these, the fact that you are dealing with an established system that has predictable success means that the bank in all likelihood is going to look somewhat more favourably on your application," McLachlan said. "In many cases, the franchisor will help you work with the bank." - Sudbury Star

The sales presentation is filled with authority and subtle positioning to the Canadian franchise buyer. It is the CFA that holds Discovery Days. And only CFA members are allowed to exhibit. Since "all CFA members are screened", a buyer could easily confuse that these seven at the event are the best of the best. Connecting the dots further, if what Ms. Lachlan says is true, if a run-of-the-mill franchise system is four times more likely to succeed than an independent business, just think how much more successful the franchise buyer will be with a system that has been "screened" by "the Canadian voice of franchising" (note the Northern imitation of the IFA motto).

A sure thing if ever there was one!